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Highest Since April, RBA On Tap


AUD/NZD prints a touch above the $1.09 handle and deals at its highest level since 21 Apr. The pair has firmed ~3.4% since printing a year to date low on 22 May.

  • Rate differentials, observed via 2 year swaps, have narrowed with today's RBA meeting in view. We now sit at -118bps having printed as wide as -166bps in late May.
  • Technically the pair is consolidating above the 200-Day EMA ($1.0830), dealing in a narrow range in recent sessions.
  • Bulls target a break of $1.0931, high from April 20, which opens up $1.1088 the year to date high.
  • On the downside bears look to first break the 200-Day EMA, which opens the 20-Day EMA ($1.0773).
  • The RBA's latest monetary policy decision is on tap today, the MNI preview of the event is here.

Fig 1: AUD/NZD Daily Spot vs AU NZ 2 Year Swap

Source: MNI/Bloomberg

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