Dollar Rides Optimism Wave; RBNZ Lifts Kiwi, Aussie Ignores CPI Surprise
| Action Insight Daily 5-28-25 |
Dollar Rides Optimism Wave; RBNZ Lifts Kiwi, Aussie Ignores CPI Surprise |
Dollar's broad-based rebound gained further momentum in Asian session today. The turnaround in risk appetite has been key in lifting the greenback, which had come under pressure amid recent tariff tensions and soft economic signals. The rebound is also visible across asset classes, US equities have reversed losses tied to US-EU trade fears, and the 10-year yield has returned to levels seen before last week’s Treasury selloff. This shift in tone followed US President Donald Trump's decision to postpone the implementation of a 50% tariff on EU goods until July 9. Trump further noted overnight that the EU had reached out to set up meeting dates, describing the latest developments as “positive.” Elsewhere, Kiwi saw a jump following RBNZ’s 25bps rate cut to 3.25%. What surprised markets was the internal division within the committee, as one member dissented and preferred no change. The minutes revealed a genuine debate on the merits of holding rates steady to better assess trade-related uncertainties and their inflationary implications. The signal was clear: while more easing is possible, the path ahead will not be automatic. Aussie, by contrast, showed a muted response to stronger-than-expected monthly CPI data. Although core inflation edged higher, it remains comfortably within the RBA’s 2–3% target band. As such, the print is unlikely to alter RBA’s policy course. With quarterly inflation data due on July 30, the central bank is expected to wait until its August meeting to make a more informed decision on the next move, likely another 25bps cut...... |
USD/JPY Daily Outlook Daily Pivots: (S1) 142.83; (P) 143.64; (R1) 145.17; More... USD/JPY's break of 144.31 resistance suggests that fall from 148.64 might have completed as a correction at 142.10. Intraday bias is back on the upside for 55 D EMA (now at 145.83). Sustained break there will affirm this case and target 148.64 resistance and above. Nevertheless, break of 142.10 will turn bias back to the downside for 139.87 low instead. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 01:30 | AUD | Monthly CPI Y/Y Apr | 2.40% | 2.30% | 2.40% | | 02:00 | NZD | RBNZ Interest Rate Decision | 3.25% | 3.25% | 3.50% | | 03:00 | NZD | RBNZ Press Conference | | 06:45 | EUR | France Consumer Spending M/M Apr | 0.80% | -1% | | 06:45 | EUR | France GDP Q/Q Q1 F | 0.10% | 0.10% | | 07:55 | EUR | Germany Unemployment Change Apr | 10K | 4K | | 07:55 | EUR | Germany Unemployment Rate Apr | 6.30% | 6.30% | | 08:00 | CHF | UBS Economic Expectations May | -51.6 | | 18:00 | USD | FOMC Minutes |
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