Reserve Bank of New Zealand Expected to Slash Rate to 3.25%; Australian Inflation Expected to Tick Lower; US Dollar Bid Over Past Few Hours
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Summary: With a probably quiet day ahead today, markets are looking forward to the RBNZ policy meeting and the release of Australian inflation data later.
- There are no real high-impact data releases scheduled today despite the return of the USA from its Memorial Day holiday lately. Markets have been relatively quiet so far today, so analysts will be looking ahead to a couple of items due over the next Asian session:
- The RBNZ is expected to cut its Official Rate from 3.50% to 3.25%. The language used by the Bank in its statement will be closely watched to determine the likely approach towards the future path of possible further rate cuts.
- Australian CPI data will be released that is expected to show the annualized rate of inflation tick lower, from 2.4% to 2.3%. If the number is significantly higher, this could reduce expectations of further rate cuts and so boost the value of the Australian Dollar.
- Bitcoin remains in focus after reaching a new record high last week at $112,00. Trend and momentum traders may be interested in getting long here. As well as spot Bitcoin, there are also Bitcoin micro futures available, and several Bitcoin ETFs so trading or investing in Bitcoin is very accessible today. The price is consolidating between $107,500 and $110,500, so a breakout beyond the higher value might be a new long trade entry signal..
- In the Forex market the strongest major currency since the Tokyo open has been the British Pound, while the Japanese Yen has been the weakest. However, the relative price movements are so small as to be practically meaningless. Over the past few hours, the US Dollar has been strongly bid, and that might be the most significant thing going on in the market right now. The clearest trend in any major currency over a meaningful period of time looks to be the British Pound, so the GBP/USD currency pair might be getting some attention today after it reached a new 3-year high price over recent days.
- Stock markets are mixed. The German DAX Index and the German stock market in general is very close to its record highs which were made just a few days ago, so if you want to trade stocks, Germany might be a useful market today. The market will be getting a boost from President Trump's postponement of the 50% tariff on EU imports until 9th July.
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