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AUDNZD: AUD/NZD On Track For 5 Straight Session Of Gains

AUDNZD
APACAustraliaNew ZealandBulletGlobalForeign Exchange BulletsRegionMarkets
  • The AUD/NZD rose for the fourth session, making a new cycle high of 1.1025 before closing +0.15% at 1.1010. The move was largely driven by the drop in the NZD following rate cut expectations increasing for next week, with the market now pricing in about a 75% chance of a 50bps cut.
  • The cross is expected to continue trending higher and is likely to test 1.1100 if indeed there is a 50bps cut next week although the escalating Middle Eastern tensions could undermine both the AUD and NZD, supporting the USD.
  • RBA dated OIS pricing has cooled 2bps heading into year end with 16bps or about a 50% chance of a cut by December this year. While looking further out to August pricing has remained steady with 88bps of cuts priced through to July.
  • The cross broke above initial resistance of 1.1000 yesterday with focus now on 1.1057 (August Highs), while to the downside a break back below 1.100 would open a move to 1.0915-1.0925 (20, 50 & 100-day EMA) a break here would open a move to 1.0800.
  • The AU-NZ 2yr swap spread tested the cycle highs again on Thursday of 21bps, before closing the session at up 1bps at 17.5bps
  • Expiries: 1.0835 ($690m) Oct 9th
  • Today we have Household spending & Loan Values at 1130 AEST
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  • The AUD/NZD rose for the fourth session, making a new cycle high of 1.1025 before closing +0.15% at 1.1010. The move was largely driven by the drop in the NZD following rate cut expectations increasing for next week, with the market now pricing in about a 75% chance of a 50bps cut.
  • The cross is expected to continue trending higher and is likely to test 1.1100 if indeed there is a 50bps cut next week although the escalating Middle Eastern tensions could undermine both the AUD and NZD, supporting the USD.
  • RBA dated OIS pricing has cooled 2bps heading into year end with 16bps or about a 50% chance of a cut by December this year. While looking further out to August pricing has remained steady with 88bps of cuts priced through to July.
  • The cross broke above initial resistance of 1.1000 yesterday with focus now on 1.1057 (August Highs), while to the downside a break back below 1.100 would open a move to 1.0915-1.0925 (20, 50 & 100-day EMA) a break here would open a move to 1.0800.
  • The AU-NZ 2yr swap spread tested the cycle highs again on Thursday of 21bps, before closing the session at up 1bps at 17.5bps
  • Expiries: 1.0835 ($690m) Oct 9th
  • Today we have Household spending & Loan Values at 1130 AEST