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NZD: NZD/USD Trades Back Above 0.6200 As USD Falls On Rate Cut Expectations

NZD
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  • The NZD/USD rose 0.73% on Monday closing back above 0.6200. The move was due to a weaker USD as the market further moves to 50bps cut at the next Fed meeting, with the BBDXY edging closer to prior cycle lows at 1,222.47. Equities continue to edge higher, supporting the higher beta currencies including the NZD.
  • The pair trades back above all key moving averages, indicating bullish momentum. Initial resistance is the Friday highs of 0.6237 (Sept 6 high) above here cycle highs of 0.6300 becomes the target. Support is Thursday's lows of 0.6130 while further below we have the 100 & 20-day EMAs at 0.6090 area.
  • The average residential property asking price in New Zealand fell 2.3% y/y in August, according to Trade Me listings. The national average asking price dropped to NZ$818,250, its lowest level since April 2021. In Auckland, the asking price fell below NZ$1 million for the first time since September 2020.
  • RBNZ dated OIS has firmed 3-5bps into year-end from Friday's levels, with 87bps of cuts priced now. Pricing through to July 2025 has also continued to firm with 229bps of cuts priced in now.
  • The NZ-US 2yr swap spread fell 3bps to 15.5bps
  • Expiries: 0.5675 ($300m) Sep 18 0.6035 ($500m) Sep 19
  • Today, Non Resident Bond Holdings at 1300 AEST / 1100 HKT
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  • The NZD/USD rose 0.73% on Monday closing back above 0.6200. The move was due to a weaker USD as the market further moves to 50bps cut at the next Fed meeting, with the BBDXY edging closer to prior cycle lows at 1,222.47. Equities continue to edge higher, supporting the higher beta currencies including the NZD.
  • The pair trades back above all key moving averages, indicating bullish momentum. Initial resistance is the Friday highs of 0.6237 (Sept 6 high) above here cycle highs of 0.6300 becomes the target. Support is Thursday's lows of 0.6130 while further below we have the 100 & 20-day EMAs at 0.6090 area.
  • The average residential property asking price in New Zealand fell 2.3% y/y in August, according to Trade Me listings. The national average asking price dropped to NZ$818,250, its lowest level since April 2021. In Auckland, the asking price fell below NZ$1 million for the first time since September 2020.
  • RBNZ dated OIS has firmed 3-5bps into year-end from Friday's levels, with 87bps of cuts priced now. Pricing through to July 2025 has also continued to firm with 229bps of cuts priced in now.
  • The NZ-US 2yr swap spread fell 3bps to 15.5bps
  • Expiries: 0.5675 ($300m) Sep 18 0.6035 ($500m) Sep 19
  • Today, Non Resident Bond Holdings at 1300 AEST / 1100 HKT