AUD/NZD sees downside below 1.0300 on hawkish RBNZ bets
|- AUD/NZD is expected to display significant losses after surrendering the cushion of 1.0300.
- The RBNZ is likely to announce a half-a-percent rate hike for the fourth time consecutively.
- A lower Australian Consumer Inflation Expectations print has failed to support aussie bulls.
The AUD/NZD pair has turned sideways at around 1.0400 after a downside move from 1.0500. The asset is on the verge of printing a fresh weekly low if the kiwi bulls manage to drag the cross below the immediate support of 1.0300. A release of an upbeat Business NZ PMI has strengthened the kiwi bulls.
The Business NZ PMI data has landed at 52.7, higher than the expectations of 52.5 and the prior release of 50. This is going to delight the Reserve Bank of New Zealand (RBNZ) in its fight against inflation. Next week, the RBNZ will announce an interest rate decision in its monetary policy meeting. RBNZ Governor Adrian Orr is expected to step up its Official Cash Rate (OCR) by 50 basis points (bps) consecutively for the fourth time. An announcement of the same will elevate the OCR to 3%.
As per the Reuters survey, the RBNZ will elevate its OCR to 4.00% by mid-2023. And, the Inflation is expected to fall within the target range of 2-3% in the H1CY2023. It seems like the RBNZ’s goal of bringing price stability is visible now.
On the Aussie front, lower Consumer Inflation Expectations data has failed to support the aussie bulls. A slippage in aussie Consumer Inflation Expectations, which presents the consumer expectations of future inflation during the next 12 months will force a decline in the hawkish guidance by the Reserve Bank of Australia (RBA).
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