Kiwi Lags Rally In High-Beta FX

A record low reading of Westpac Consumer Confidence created a drag on the kiwi dollar Tuesday, even as the broader high-beta FX space capitalised from better risk backdrop.

• NZD/USD operates at $0.6329 at typing, near yesterday's closing levels. The key near-term layer of support has been defined at $0.6197, the low print of Jun 14. Bulls look for a rally above Jun 16 high of $0.6396, which would bring Jun 3 high of $0.6576 into play.
• Two of New Zealand's "Big Four" banks, ANZ and BNZ, announced sharp increases in interest rates on home loans and deposits this week as monetary conditions tighten.
• The market still fully prices a 50bp hike to the OCR next month, despite household budgets being squeezed by rising interest rates and higher costs of living.
• Data released this morning showed that New Zealand's monthly trade surplus shrank to NZ$263mn in May from NZ$440mn prior.
• Local credit card spending data will hit the wires later today.