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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.
AUDNZD
AUD/NZD is back close to Jan lows. The pair currently sits near 1.0700. A fresh break below this level could see Dec lows near 1.0655 targeted, while Oct lows rest at 1.0624. All key EMAs sit above spot, the 200 day around 1.0805.
- Downside momentum in the pair is consistent with weaker AU yield momentum versus NZ. The chart below overlays the AUD/NZD cross against the 2yr swap spread.
- The spread has come off around 25bps in recent weeks, with a good part of the move happening over the past week.
- We have had a hawkish rebuff from the RBNZ Chief Economist around domestic inflation pressures, while yesterday's downside Q4 surprise in Australia has helped raised RBA easing odds.
- Of course, we hear from the RBA next week in its first policy meeting of the year. No changes are expected, but the RBA language around the policy bias will clearly be watched closely.
Fig 1: AUD/NZD Versus AU-NZ 2yr Swap Spread
Source: MNI - Market News/Bloomberg
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.
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