Free Trial

ANZ: Pricing Of Other CBs “Catching Up” To That Of RBNZ

NZD

ANZ note that “the Kiwi is back in the low $0.67s as the local trading day gets underway, having succumbed to the rebound in the USD on the back of the pop higher in U.S. bond yields. The Kiwi is very sensitive to long end bond spreads (a reasonable proxy for terminal cash rate expectations), and the latter continue to rise in the U.S. NZ rate expectations have also risen following last week’s post-RBNZ retracement, but with 125bp of hikes already “in the tin” here (compared to just 25 in the U.S.), and a peak OCR of 4.13% already priced in by the end of 2023, there’s arguably less scope for upside, which in turn could cap the NZD. Broadly speaking, it’s a picture of other CBs catching up on NZ’s erstwhile rate advantage.”

MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.