Aus & NZ Dollar Exchange Rate Today: AUD/NZD Forecast to Gain on RBNZ Confusion

July 20, 2014 - Written by David Woodsmith

STORY LINK Aus & NZ Dollar Exchange Rate Today: AUD/NZD Forecast to Gain on RBNZ Confusion

Currency News Today - Australian Dollar to New Zealand Dollar (AUD/NZD) set to strengthen over RBNZ Confusion Geopolitical concerns dominated market sentiment on Friday after a Malaysian passenger airliner was suspected of being shot down over the conflict zone in eastern Ukraine killing all 298 passengers and crew on board. The Pound to Australian Dollar exchange rate is 0.05% per cent higher today 1.81990 GBP/AUD. The Pound to New Zealand Dollar is 0.01 per cent high at 1.96332 GBP/NZD.

As the news broke of the tragedy the Australian Dollar and other riskier commodity based currencies fell as investors were spooked and sought shelter in the safe haven Japanese Yen and Swiss Franc. The news also caused global equities to tumble.

Tensions between the West and Russia are likely to rise further after Ukraine accused pro-Russian separatist rebels of shooting the plane down with Russian provided sophisticated anti-aircraft weaponry.

Russian President Vladimir Putin hit back by denying any responsibility and blamed Kiev as the crash would not have happened at all if not for the strife between the government and rebels. The world will be watching to see what any investigation will reveal about the crash, further sanctions on Russia are likely if it turns out that the anti-aircraft missiles were supplied by them and granted to the rebels.

As a result of the incident the Japanese Yen soared to a five-month high against the Euro and regained ground against the US Dollar before in turn weakening following the release of dovish Bank of Japan policy meeting minutes.

As the session progressed the impact of the crash lessened on the financial markets and the Australian Dollar managed to recover lost ground against a number of major peers. Against its New Zealand relation the ‘Aussie’ strengthened following the publication of better than expected data out China.

“There’s no sign of panic, the markets are regarding the downing of the aircraft as a major economic or financial event and not something with profound implications for market,” said Westpac senior currency strategist Sean Callow.

The ‘Aussie’ was finding support from the release of positive data from Australia’s biggest trading partner, China. According to research agency MNI business confidence in China increased in July by a sharp margin.

The MNI business sentiment Index, a measure of current business expectations, increased to 58.2 in July, up from the 55 figure recorded in June. The index has remained above the 50 level which indicates increases expectations since January 2009. However, confidence concerning future business prospects decreased in July, though it remained above the no change mark of 50. The corresponding index fell to 61.5 in July from 64.2 in June.

The New Zealand Dollar meanwhile extended its run of declines as geopolitical concerns weighed upon demand for the currency. As well as the downing of MA flight-17 the markets were spooked by the launching of an Israeli ground offensive against the Gaza Strip.

Declines were limited however as investors were uncertain as to whether the New Zealand Central Bank will raise interest rates at next week’s policy meeting.

“You would expect the ‘Kiwi’ to remain under pressure but stronger job advertisements in ANZ’s survey and a pick-up in consumer confidence is a reminder that the New Zealand economy is overall is solid, they’re wary of selling something with a positive carry ahead of the RBNZ’s July 24th statement,” said Sam Tuck a senior FX strategist at ANZ Bank New Zealand.

Key data release for Australian and New Zealand Dollar

Wednesday July 23rd – Australia Inflation Rate YoY and QoQ
New Zealand Interest rate decision
New Zealand Balance of Trade

GBP/AUD Update 21/07/2014

The Pound to Australian Dollar exchange rate was trading firmer on Monday as demand for riskier commodity based assets remained under pressure from geopolitical concerns.

Investors remained spooked over a rise in tensions between the West and Russia after the shooting down of a civilian passenger jet last week.

News released on Monday further spooked the markets as Ukrainian troops advanced into the rebel held eastern Ukrainian city of Donetsk. The ‘Aussie’ was also weaker against the Euro and US Dollar.

Top Australian & New Zealand Dollar Exchange Rates - Updated 22/07/2014

The Australian Dollar to Canadian Dollar exchange rate is trading up +0.34% at 1.00912 AUD/CAD.
The Australian Dollar to Euro exchange rate is trading up +0.61% at 0.69668 AUD/EUR.
The Australian Dollar to Pound Sterling exchange rate is trading up +0.34% at 0.55048 AUD/GBP.
The Australian Dollar to New Zealand Dollar exchange rate is trading up +0.39% at 1.08325 AUD/NZD.
The Australian Dollar to US Dollar exchange rate is trading up +0.31% at 0.93936 AUD/USD.
The New Zealand Dollar to Australian Dollar exchange rate is trading down -0.39% at 0.92314 NZD/AUD.
The New Zealand Dollar to Canadian Dollar exchange rate is trading down -0.05% at 0.93156 NZD/CAD.
The New Zealand Dollar to Euro exchange rate is trading up +0.21% at 0.64314 NZD/EUR.
The New Zealand Dollar to Pound Sterling exchange rate is trading down -0.06% at 0.50817 NZD/GBP.
The New Zealand Dollar to US Dollar exchange rate is trading down -0.08% at 0.86716 NZD/USD.

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