Inflation Day

Antipodean currencies were in demand Wednesday, with NZD/USD rallying above the $0.6800 figure as a result. Broader greenback weakness added fuel to the upswing, even as a couple of Fed policymakers called for expedited tightening.

• Quarterly CPI report provides the highlight of New Zealand's data docket today. Bloomberg consensus looks for further acceleration in headline inflation to +7.1% Y/Y, with estimates ranging from +6.7% to +7.4%.
• The RBNZ's forecast from February MPS was more conservative, as the Reserve Bank predicted that prices would grow +6.6% Y/Y in the fist three months of the year, although this may now be slightly outdated.
• Measures of core price pressures will draw attention after last week's monetary policy review saw the MPC take note of underlying inflation sitting at/above the target range.
• Please note that the RBNZ will release its preferred metric of core inflation (sectoral factor model) at 15:00 NZST/04:00 BST. As a reminder, data from StatsNZ will hit the wires at 10:45 NZST/23:45 BST.
• NZD/USD trades flat at $0.6808 at typing. From a technical point of view, bulls look for further gains past the 200-DMA/Apr 13 high at $0.6899/0.6902. Conversely, the initial layer of support has been defined at $0.6715, which limited losses on Apr 18.