Kiwi Gains As Sell-Side Analysts Take Note Of GDP Overshoot

Kiwi continues to gain across the board, after the release of strong NZ GDP data as well as ANZ's subsequent comment that they are revising their RBNZ call and now expect the next OCR hike in Feb '22 rather than Aug '22. NZD/USD sits at $0.7083, 32 pips higher on the day and close to the 38.2% recovery of yesterday's sell-off. The intraday gain of 0.5% has been the pair's largest since Jun 4.

• ASB noted that they "currently expect the RBNZ to start lifting the OCR in May 2022, but strong economic data now skew the risk to an even earlier move than that," while Kiwibank said that they "see expectations shift toward an earlier lift-off in the OCR than the Reserve Bank has scheduled".
• AUD/NZD staged a clean break under yesterday's low and last operates -48 pips at NZ$1.0745. Participants have scrutinised a speech from RBA Gov Lowe, who noted that in some scenarios, "the conditions for an increase in the cash rate could be met during 2024, while in others these conditions are not met". AUD/NZD is printing session lows as we type, with bears keeping an eye on the nearby 200-DMA/Jun 7 low at NZ$1.0728/19.
• NZD/JPY last +40 pips at Y78.46, still within yesterday's range. Familiar technical picture remains in play.