Australian Dollar
Expected Range 0.7350 – 0.7550
The last week was a volatile one for the AUD after performing well for most of the week after starting the week at 0.7429 against the USD. The AUD climbed to the reach highs of 0.7647 just before the votes were counted in the Brexit vote in the UK. The unexpected result of the UK deciding to leave the Eurozone saw a lot of money move toward the safe haven currencies like the USD and JPY and as a result the AUD fell to 0.7306 as the result became clear. The AUD did finish strong during UK and US trading hours testing 0.75 before closing the week at 0.7462. With limited data out this week the fallout from the Brexit vote will continue to dominate the headlines. The AUD opens this morning 50 points down from Friday’s close at 0.7415.
New Zealand Dollar
Expected Range 0.700 – 0.7200
The New Zealand Dollar fell sharply off the back of the UK population deciding that they wanted to leave the Eurozone. After hitting highs above 0.7250 in the lead up to the decision it fell to hit lows of 0.6969 after the votes came in. As a risk off approach came over the market there was a big movement away from the higher yielding commodity linked currencies including the NZD. The NZD was able to recover some ground in the overnight session to close the week at 0.7112. The main data point out this week for the NZD is the NZ Trade Balance data which will be released this morning.
Great British Pound
Expected Range 1.9300 – 1.9700
A big day for the UK and a big day for the GBP following the referendum over whether or not the UK should stay in the Eurozone. The vote which saw the “Leave” side of the campaign with the most votes at the end of the day resulted in a large negative movement in the currency, a Prime Minister to resign and a potential downgrading of Britain’s creditworthiness by ratings agency Moody’s. The GBP fell from 1.9667 against the AUD to 1.8234 in a matter of hours following the surprise decision. The ramifications of the decision will take some time to go through with the UK having 2 years to go through the process of negotiating an exit from the European Union with a number of potential challenges in the process. The GBP is currently buying 1.3421 USD and 1.8952 NZD.
Majors
Expected Range N/A
A positive day for safe haven currencies like the USD and JPY as the world reacted to the news that the UK had voted to leave the Eurozone. A significant movement of money away from the UK and higher yielding currencies saw the GBP fro from 1.5006 before the vote to 1.3240 against the USD. The ramifications of the decision will likely have a significant impact on the markets across the next couple of days as the market tries to work out the next steps. The Euro followed a similar path to the GBP as the uncertainty about what the decision by the UK people to leave would mean for the trading bloc. A quiet day from a data release perspective means that the Brexit vote will continue to dominate the market.