A weaker NZD against a stronger AUD? [Video]
|Listen to the latest market mood for the AUDNZD pair.
AUD strength
Australia's employment change data showed some encouraging signs for Australia's job market. July's data showed an addition of 114.7k jobs and 43.5K of these were full time The unemployment rate also came in lower at 7.5% vs the 7.8% expected.
NZD weakness
Building on the RBNZ's dovish picture yesterday deputy Governor Bascand said that the resurgence of the virus in New Zealand is a big risk. He said that the RBNZ will probably combine negative rates with funding for lending programmes if more stimulus is needed beyond yesterday's $40 billion QE extension.
This should mean a weaker NZD against a stronger AUD for today's session. Therefore expect buyers on pullbacks on the AUDNZD pair. We expect this trade to play out between now and the next 3-4 days.
Trade Risks: If we see any very negative US-China news that will weigh more heavily on the AUD than the NZD and will invalidate this outlook.
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