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Dovish RBA Hike May Cap AUD/NZD Cross

AUDNZD

Judging by the decline in the AU-NZ 2yr swap spread after today’s RBA hike, down to -107bps, versus -67bps yesterday, the AUD/NZD may see further downside traction. The chart below plots the AUD/NZD cross against this swap spread.

  • The cross was 1.1415/20 prior to the print, but we now sit under 1.1340/45. The 1.1320/30 region could offer support, while beyond that is the low 1.1300 and then a number of highs just above 1.1250 from mid September. On the top side, recent highs around 1.1420/40 may offer resistance.

Fig 1: AUD/NZD Versus 2yr Swap Spread

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Judging by the decline in the AU-NZ 2yr swap spread after today’s RBA hike, down to -107bps, versus -67bps yesterday, the AUD/NZD may see further downside traction. The chart below plots the AUD/NZD cross against this swap spread.

  • The cross was 1.1415/20 prior to the print, but we now sit under 1.1340/45. The 1.1320/30 region could offer support, while beyond that is the low 1.1300 and then a number of highs just above 1.1250 from mid September. On the top side, recent highs around 1.1420/40 may offer resistance.

Fig 1: AUD/NZD Versus 2yr Swap Spread

Keep reading...Show less