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Market news

25 January 2023

AUD/NZD Price Analysis: Bulls poke 10-week-old hurdle above 1.0900 after Aussie, NZ inflation

  • AUD/NZD takes the bids to refresh one-week high after upbeat quarterly inflation data from Australia, New Zealand.
  • Overbought RSI, descending resistance line from November 11 challenge pair buyers.
  • Five-week-old ascending trend line, 200-SMA restrict short-term declines.

AUD/NZD jumps the most in three weeks after inflation data from Australia and New Zealand published upbeat results early Wednesday. That said, the exotic pair grinds higher past 1.0900 at the latest, following the recent run-up to 1.0926.

Earlier in the day, New Zealand Consumer Price Index (CPI) for the fourth quarter (Q4) rose past 7.1% YoY market forecast to reprint the 7.2% figures while the QoQ data suggests a 1.4% number against 1.3% expected and 2.2% prior. It’s worth noting that the Reserve Bank of New Zealand (RBNZ) anticipated 7.5% yearly inflation in its November meeting.

Following that Australia’s Q4 CPI rose to 7.8% YoY versus 7.5% expected and 7.3% prior while the RBA Trimmed Mean CPI jumped to 6.9% YoY compared to 6.5% market forecasts and 6.1% previous readings. Further, the Monthly CPI rose to 8.4% from 7.3% previous readings and 7.7% market forecasts.

Given the comparatively stronger Aussie inflation numbers, the AUD/NZD pair pokes a downward-sloping resistance line from November 11, around 1.0920 by the press time. However, the overbought RSI and fears of the Reserve Bank of Australia’s (RBA) less-hawkish play challenge the pair buyers. Also acting as an immediate upside hurdle is the monthly peak surrounding 1.0940.

It’s worth mentioning that the bullish MACD signals keep the AUD/NZD buyers hopeful. That said, the five-week-long rising trend line and the 200-SMA restrict the quote’s immediate downside to around 1.0780 and 1.0735 respectively.

Overall, AUD/NZD is likely to remain firmer but the upside room appears limited.

AUD/NZD: Four-hour chart

Trend: Pullback expected

 

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