Spikes On Hawkish RBNZ Comments, 20 & 50 Day EMAs Sit Above 0.6150

NZD/USD spiked late Monday NY/early Tuesday NZ trade, as RBNZ Chief Economist Conway spoke. The pair got to a high of 0.6144, just below Tuesday highs from last week. We sit slightly lower in current dealings, in the 0.6130/35 range. The Kiwi is up around 0.60% for Monday's session as a whole, the best performer in the G10 space.

• Conway struck a hawkish tone, playing down the impact of recent lower GDP revisions, highlighting that private sector demand was revised higher. He again reiterated the net migration story.
• While welcoming the downturn in inflation. Conway noted that non-tradables inflation in Q4 had been stronger than the central bank expected and that it is still some way to go to reach the inflation target (see this link for more details). The speech may see RBNZ rate cut expectations trimmed.
• The broader macro backdrop was supportive for NZD through Monday trade. US yields finished lower, roughly -3-6bps across the benchmarks, as the US Tsy reduced its borrowing estimates for Q1. Equity sentiment was positive in US markets as well (SPX +0.76%).
• The local data calendar is empty now until tomorrow, when ANZ business survey conditions are out.
• For NZD/USD, dips sub 0.6100 remain supported. On the topside, the 20 and 50 day EMAs rest in the 0.6150/0.6160 region, which need to be cleared for an extension of gains.