Collinson FX: May 23: RBNZ holds the line on OCR and triggers NZD rally

by Collinson FX 22 May 2024 16:34 PDT 23 May 2024

WASZPs racing in the SailGP Inspire program - Lyttelton - March 23, 2024 © Justin Mitchell

May 23: RBNZ holds the line on OCR and NZD rallies

UK inflation numbers tumbled, from 3.2% to 2.3%, but remained higher than expected. This was enough to push bond yields higher and the GBP, as market analysts now defer the probable interest rate cuts from the Bank of England, until later in the year. The initial surge in the currency was reversed, when the Fed Minutes confirmed similar circumstances, with ‘persistent inflation’ even suggesting further rate hikes, before any US interest rate cuts, would come from the Fed. This was met with a surge in US Bond Yields and the US Dollar. The GBP beat a hasty retreat, back to 1.2700, while the EUR fell back to 1.0800.

The RBNZ was also hawkish, citing inflationary pressures, in their latest decision to leave interest rates at these elevated levels, until at least next year. The had the same impact on the currency, with the NZD rallying strongly following the RBNZ rate decision, only to fall flat following the release of the Fed minutes. The NZD settled back below 0.6100, while the AUD retreated back towards 0.6600. The persistent inflationary pressures look set to continue, despite enormous political and economic pressures, for cuts. Inflation remains the key driver in currency markets.

For the latest and recent market commentaries from Collinson & Co see collinsonco.com/news-updates

Catch the new look Collinson FX website at www.collinsonco.com

Disclaimer: The details expressed in the Collinson FX website and accompanying documents or transmissions are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. Collinson Forex Ltd accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the information contained or related to this site

Collinson Forex offers valuable insights and solutions to boat enthusiasts and industry professionals alike. They offer a range of tailored currency services, designed to support individuals and businesses involved in the marine sector, facilitating seamless international transactions and optimizing financial operations. Founded in 1994, Collinson Forex is a trusted financial partner within the marine community. collinsonco.com/business-forex

Collinson Crowdfunding provides innovative equity crowdfunding services, aiming to connect businesses looking to raise capital with investors who are looking for new opportunities. They do this by offering a website for companies to make share offers and support to streamline the offer process. For investors, Collinson Crowdfunding offers a simple way to invest in exciting businesses. collinsonco.com/crowdfunding

Contact Collinson on 0800 338 838

Related Articles
Collinson FX: US markets tread water
Reserve bank of Australia's Governor says the next rate move may well be up in 2026 Reserve Bank of Australia left rates unchanged, as expected, citing inflationary pressures. Fiscal pressures have put the RBA into a tough position, with no option but to hold rates, and the Governor stated the next rate move may well be up in 2026 Posted on 10 Dec Collinson FX: US markets testing record highs
Market confidence is high, with the Federal Reserve expected to cut rates overnight US Markets continued to rally, with equities tested record highs and bond yields tumbling. Market confidence is high, with the Federal Reserve expected to cut rates overnight and once again before Christmas. Posted on 29 Oct Collinson FX: Oct 10: Political turmoil
Political turmoil creates uncertainty, and this is driving the road towards safety. Political turmoil creates uncertainty, and this is driving the road towards safety. Posted on 9 Oct Collinson FX: Oct 2: Shutdown brushed off
EU CPI data confirmed inflation is once again on the rise in Europe. The much vaunted US Govt shutdown was highly dramatic amongst the media and in Washington but was brushed off by markets, with equities and bonds steady. EU CPI data confirmed inflation is once again on the rise in Europe. Posted on 1 Oct Collinson FX: Sep 11: US Fed rate cuts expected
Chinese CPI inflation was negative. They almost have deflationary problems. A US CPI inflation rate of around 2.9% or less will ensure that a Fed rate cuts is almost a certainty. China's CPI inflation was negative, easing monetary concerns. AUD and NZD both rise slightly. Posted on 11 Sep Collinson FX: Aug 27: French Govt's woes hit Euro
European markets nosedived, triggered by the potential collapse, of another French Govt The minority Government has put the Budget up for a confidence vote, on September 8th (which is likely to fail), bringing down the Government. This was enough to poison European markets Posted on 26 Aug Collinson FX: Aug 26: Markets and data call tune
Equity markets took profit, following the big gains booked Friday after Powell admission Equity markets took profit, following the big gains booked Friday, triggered by admissions from Fed Chair Powell that rate cuts were due. Posted on 26 Aug Collinson FX: August 21: Bearish outlook for NZ
RBNZ cut rates 25 basis points, but the associated commentary was extremely bearish. The RBNZ cut rates 25 basis points, in line with expectations, but the associated commentary was extremely bearish. The RBNZ noted the economy was struggling and that further rates cuts were more than likely required. Posted on 20 Aug Collinson FX: July 17: Chase for Trade Agreements
These trade dependent nations are desperate to negotiate a deal with the US Trade dependent nations are desperate to negotiate a deal with the US, but are finding it difficult, to even secure a meeting. Posted on 16 Jul Collinson FX: July 10: "Wait and see"
This is more a ‘wait-and-see policy' than a ‘job-done', as the NZ economy remains on struggle street The RBNZ followed the lead of the RBA and left rates unchanged. This is more a ‘wait-and-see policy' than a ‘job-done', as the NZ economy remains on struggle street. Posted on 10 Jul