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AUD/NZD Drops As Risk Markets Fall, Down 2% This Week

NZD
  • The AUD/NZD tracked risk markets lower on Thursday, finishing the session down 0.59% at 1.0929 and is now testing the 100-day EMA. The AUD was the worst performing currency behind the GBP after the BOE cut rates.
  • The cross now trades at monthly lows, a break below the 100-day EMA at 1.0927 opens a move to 1.0916 (June 16 lows) resistance is now 1.0982 (50-day EMA).
  • AU OIS pricing has firmed with a cumulative 10bps of cuts into year-end, with almost 2 cuts now priced in for the Feb meeting.
  • The AU-NZ 2yr swap spread gapped lower to -23.5bps on CPI data Wednesday, we have slowly ticked higher from there and trade at -15bps.
  • Expiries: 1.1025 (A$545m) Aug 2nd NY Cut
  • Today, PPI and Loan Values Data at 11:30 AEST

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