Kiwi Trims Gains Inspired By RBNZ Wagers But Remains Best G10 Performer

NZD/USD registered some marginal gains Wednesday, after a round trip from its intraday high at $0.7061. OCR hike wagers continued to build, with Westpac and ANZ joining their peers from New Zealand's "Big Four" in forecasting RBNZ policy tightening in November. This provided a tailwind to the kiwi in early trade, but the London/NY crossover saw NZD/USD dip into negative territory, alongside a pullback in U.S. equity benchmarks. The pair then moved away from lows, before a brief uptick after the release of FOMC minutes. The recovery seen late doors allowed the kiwi to return as the best performer in G10 FX space.

• New Zealand's Financial Markets Authority released their annual investor confidence survey, which showed that the proportion of investors confident in domestic financial markets increased to 72% from 66% last year, reaching the highest level since the beginning of the survey in 2013.
• New Zealand's job ads index rose 1% M/M in June to a fresh record high, according to BNZ data. The index now sits around 24% above pre-Covid levels. The data ties up with other data signals flagged here before, pointing to mounting labour shortages in Aotearoa.
• With little of note left on the NZ docket this week, Chinese inflation data, due Friday, may provide some interest. Next week, focus in NZ turns to RBNZ Monetary Policy Review and Q2 CPI.
• NZD/USD trades at $0.7019, virtually unchanged on the day. A break above Jul 6 high of $0.7105 would put bulls back into the driving seat, clearing the way to Jun 15 high of $0.7161. Bears look for a dip through Jul 6 low of $0.6988, which would shift focus to Jul 2 low of $0.6948.