NZD remains under modest pressure headed.......>

KIWI: NZD remains under modest pressure headed into the final few hours of

London trade Monday, and sits a touch weaker against most others in G10. Bulls

have had a hard time breaking convincingly above the 100-dma, which has held as

decent resistance on a number of occasions last week and in early November. That

level currently sits at $0.6426. 

- Along with the rest of G10FX, NZD/USD implied vols are running close to, or

sit at all time lows. Realised vols, however, are still running at a decent

level for NZD/USD. The 1m measure is currently printing just above the rolling

12m average and may remain propped up by the data schedule this week (retail

sales, trade balance and ANZ business/consumer confidence figures are all due).

- Markets still see a decent chance of an RBNZ rate cut early next year. The

next meeting is on February 12th, and markets are pricing a 32% chance of a

25bps cut. This is yet to be reflected in vols, however, with 3m contract last

week hitting record lows of just 6.8 points.