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Retains Topside Momentum


AUD/NZD rallied yesterday, reversing losses from the prior two days and returning onto the NZ$1.10 handle. That round figure provided support last doors, as the rate ebbed off highs. There was little to drive the move apart from familiar factors weighing on NZD. Comments from RBNZ Asst Gov Hawkesby were initially ignored, as the official offered little new, but worth noting that NZD sales took hold in European hours.

  • Topside momentum remains, as the pair has already added 18 pips and last sits at NZ$1.1023. A move through the cycle high of NZ$1.1044, printed on Aug 18, would bring 2018 high of NZ$1.1175 into view. Bears would be pleased by Aug 19 low of NZ$1.0930, which would draw attention to Jun 2 high of NZ$1.0881.
  • CBA released preliminary readings of Australian PMIs for August. All three metrics declined, which CBA deemed "hardly surprising given the lockdown measures in Victoria".
  • Focus moves to NZ credit card spending and flash Australian retail sales. A webinar with RBNZ Chief Economist Ha & external RBNZ MPC member Buckle is underway.

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