AUD/NZD eyes heaviest declines in a month after RBNZ, Governor Orr’s upbeat comments

AUD/NZD bears attack 1.0600, down 0.52%, after RBNZ Governor Adrian Orr marks resilience on economic activity amid the early Wednesday. The pair earlier dropped from 1.0692 to 1.0650 after the Reserve Bank of New Zealand’s (RBNZ) monetary policy decision entertained the bears.

Despite matching the wide marked consensus of no change and an addition into the Large Scale Asset Purchases (LSAP) program, by $100 billion, the RBNZ shared a few details of the new monetary policy tool, the Funding for Lending Program (FLP), which avails cheap funds for the banks. While cheering the initial RBNZ move, AUD/NZD sellers also ignored that central bank’s commentary showing readiness for the negative rates, if needed.

Read: Breaking: RBNZ unchanged and sticks to guidance of March 16

Following RBNZ moves, Governor Orr sounds optimistic for the domestic and the international economic recovery. The policymaker also hints the size of the FLP, near $28 billion, which will begin from December.

Read: RBNZ’s Orr: Economic activity since Aug more resilient than earlier assumed

On the contrary, Australia’s Westpac Consumer Confidence for November slipped below 3.8% forecast to 2.5%, which in turn added weakness into the pair. Furthermore, mixed market mood amid no US treasury trading and a lack of boost to the vaccine hopes, coupled with the coronavirus (COVID-19) woes and Donald Trump’s efforts to keep the White House, also weigh on the pair.

Moving on, a light calendar will join the risk catalysts to offer intermediate moves while the US traders enjoy the holiday.

Technical analysis

An ascending trend line from July 13, at 1.0598 now, challenges the AUD/NZD bears before directing them to the four-month low of 1.0558.