RBNZ keeps hawkish tone

<p>The RBNZ hiked interest rates by 25 basis points (as expected) overnight but surprised the market with a continued hawkish tone to the subsequent statement. […]</p>

The RBNZ hiked interest rates by 25 basis points (as expected) overnight but surprised the market with a continued hawkish tone to the subsequent statement. Adding inflation pressures will increase the need for further tightening, despite the recent fall in Dairy prices.

In Australia, the labour report showed employment fell by 4,800 jobs in May versus the expectation to add 10,000 and the overall unemployment rate remained steady at 5.8%.

The diversification across the Tasman Sea saw AUD/NZD move 150 points in the session before seeing some limited retracement as traders noted the dismal Australian jobs data was due to the reduction in the part-time component.

Tonight, the market will be looking at the industrial production and retail sales releases from China that’s had the market talking about a further cut to the reserve requirement ratio to support the economy. This is on speculation that the upcoming data could disappoint.

Tensions in Iraq have added a slightly negative tone to risk as rebels seize the town of Tikrit, which, along with further unrest in Libya, sent oil prices soaring to three-month highs.

Today, the focus will switch to the US and the consumer, with retail sales data scheduled to be released from across the pond – along with the weekly jobless claims data. The only distraction this morning will be the latest industrial production data from Europe.

 

 

EUR/USD

Supports 1.3500-1.3480-1.3400 | Resistance 1.3555-1.3580-1.3625

 

 

USD/JPY

Supports 101.75-101.40-100.80  | Resistance 102.50-102.85-103.05

 

 



GBP/USD

Supports 1.6770-1.6735-1.6690 | Resistance 1.6825-1.6885-1.6920

 

 

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