Aussie and Kiwi Rise as Oil Prices Fall, Inflation Concerns Ease

The Australian and New Zealand dollars strengthened on July 27 as hopes for a diplomatic solution to the Middle East conflict sent oil prices lower, easing inflation concerns.

The Aussie rose 0.2 per cent to US$0.7001 after gaining 0.3 per cent on Friday, leaving it little changed for last week. It has continued to move away from a three-month low of US$0.6867 with resistance seen at the one-month peak of US$0.7026.

The New Zealand dollar added 0.2 per cent to US$0.5798 after ending last week down 1 per cent, weighed mainly by losses against its Australian counterpart. Resistance is now seen at the 200-day moving average of US$0.5822.

Investor focus will shift to quarterly inflation data due on Wednesday, where economists expect the trimmed mean measure of core inflation to rise 0.9 per cent in the second quarter, lifting the annual rate to 3.7 per cent.