AUD/NZD: Bears Relentless on Horrid Aus CPI, 1.11 Eyed
The Australian dollar was smashed by its OZ neighbour following the
release of extremely poor Australian CPI numbers, which shocked markets
AUD/NZD plunges more than 100-pips
The AUD/NZD pair now sinks -0.78% to fresh five-day lows of 1.1139, falling like a knife from 1.1256 levels. The cross came under heavy selling pressure after the Australian inflation report surprised markets, showing that the OZ economy slipped into deflation in Q1 and reinforced further easing from RBA as early at its next policy meeting.
Further, the Kiwi also received a rub-off effect from its OZ counterpart and extended lower, adding to the downside in the AUD/NZD cross. On the data front, Australia's CPI fell 0.2% in Q1, the first decline in the figures since 2009 and much weaker than expectations of a 0.3% increase. Australia's trimmed mean CPI eased from 2.1% to 1.7% last quarter.
Next on tap for the cross remains the EIA crude inventory report, which is expected to have major impact on the resource-linked antipodeans, while the main risk event is likely to be the FOMC monetary policy decision.
AUD/NZD Technical Levels
To the upside, the next resistance is located at 1.1188/ 1200 (10-DMA/ psychological levels) and above which it could extend gains to at 1.1242/56 (daily pivot & high).To the downside immediate support might be located 1.1100/1.1094 (round number/ 50-DMA) below that at 1.1061 (Apr 20 Low).