Higher inflation in Australia, everything as expected in New Zealand – Commerzbank
|The Australian inflation indicator for April, published this morning, came in at 2.4%, which is slightly higher than expected, Commerzbank's FX analyst Michael Pfister notes.
Aussie inflation ticks higher; Kiwi holds steady after expected cut
"However, it should be noted that it remains within the Australian central bank's target range of 2–3% and only reflects part of the actual price change. Before the central bank makes its next decision in early July, we will see the growth figures for the first quarter, another labour market report, and the inflation figures for May. Accordingly, it is hardly surprising that the Australian dollar has barely reacted to today's figures."
"Meanwhile, as expected, the New Zealand central bank (RBNZ) cut interest rates by another 25 basis points this morning. The RBNZ pointed out that inflation is within the target range and that the real economy is slowly recovering, despite global uncertainties weighing on it. The key interest rate forecast was lowered slightly, suggesting that another rate cut is likely in the coming months."
"However, the RBNZ is now close to its terminal rate. Today, one of the decision-makers voted in favour of keeping interest rates unchanged, which is likely one of the reasons for the positive reaction of the Kiwi. Additionally, the central bank's chief economist emphasised that the key interest rate has now reached its neutral range. We therefore expect the RBNZ to end its cycle of interest rate cuts soon."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.