Steady Even As Hawkish RBNZ Bets Are Added, Domestic Politics Draw Attention

NZD/USD trades flat at $0.6548, unfazed after Kiwibank pulled forward their RBNZ rate-hike call, noting that they "now see the RBNZ hiking the cash rate at every meeting in 2022, taking the cash rate to 2.50% by Nov." Liquidity may be limited on the back of an Auckland holiday, as well as market closures in several Asian economies, including China.

• Bears need a breach of $0.6530, which limited losses last Friday, before setting their sights on Sep 24/Aug 20, 2020 lows of $0.6512/0.6489. Conversely, a break above Jan 19 high of $0.6812 would give bulls some reprieve.
• Polling showed that PM Ardern's net approval rating has dipped below that of Opposition Leader Luxton, albeit it must be noted that Luxton scored a fairly high "don't know/refuse to answer" result. The National Party is on its annual retreat through Tuesday.
• Ardern is currently self-isolating after being identified as a close contact of a domestic flight passenger infected with Covid-19. She returned a negative test today and will chair tomorrow's Cabinet meeting remotely.
• Data highlights this week include trade balance (Tuesday) and labour market report (Wednesday).