|

AUD/NZD rallies as RBNZ signals dovish shift

  • AUD/NZD witnessed a significant rise to 1.1090, to multi-year highs.
  • The RBNZ kept rates steady at 5.5%, signaling a willingness to ease sooner rather than later.
  • RBA and RBNZ policy discrepancies might favor the AUD.

On Wednesday, the AUD/NZD rose to a fresh high since 2022, in reaction to the Reserve Bank of New Zealand (RBNZ) decision.

The RBNZ, as expected, kept the Official Cash Rate (OCR) anchored at 5.50%, but hinted at potential rate cuts in the near future. The RBNZ highlighted the signs of easing inflation persistence and the expectation of headline CPI returning to target in the second half of the year. Moreover, it addressed the impact of tight policy measures on the economy and deviated from the May 22 meeting where Governor Orr confessed that a hike was a "real consideration".

Following the decision, a rate cut is now priced in October, with the market pricing in nearly 60% odds of an earlier cut in August. On the other hand, while the Reserve Bank of Australia (RBA) seriously considers a hike, the pair may see more upside.

AUD/NZD technical analysis

In the short-term, the AUD/NZD maintains a bullish momentum due to the recent rally but overbought conditions seen in the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) indicate that a correction may be imminent.

Support levels have moved and now stand at 1.1050, 1.1000, and 1.0950. The next challenge for buyers is to reach and retain the 1.1100 target point.

AUD/NZD daily chart

Author

Patricio Martín

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

More from Patricio Martín
Share:

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

By subscribing you agree to our Terms and conditions.

Editor's Picks

EUR/USD moves sideways below 1.1800 on Christmas Eve

EUR/USD struggles to find direction and trades in a narrow channel below 1.1800 after posting gains for two consecutive days. Bond and stock markets in the US will open at the usual time and close early on Christmas Eve, allowing the trading action to remain subdued. 

GBP/USD keeps range around 1.3500 amid quiet markets

GBP/USD keeps its range trade intact at around 1.3500 on Wednesday. The Pound Sterling holds the upper hand over the US Dollar amid pre-Christmas light trading as traders move to the sidelines heading into the holiday season. 

Gold retreats from record highs, trades below $4,500

Gold retreats after setting a new record-high above $4,520 earlier in the day and trades in a tight range below $4,500 as trading volumes thin out ahead of the Christmas break. The US Dollar selling bias remains unabated on the back of dovish Fed expectations, which continues to act as a tailwind for the bullion amid persistent geopolitical risks.

Bitcoin slips below $87,000 as ETF outflows intensify, whale participation declines

Bitcoin price continues to trade around $86,770 on Wednesday, after failing to break above the $90,000 resistance. US-listed spot ETFs record an outflow of $188.64 million on Tuesday, marking the fourth consecutive day of withdrawals.

Economic outlook 2026-2027 in advanced countries: Solidity test

After a year marked by global economic resilience and ending on a note of optimism, 2026 looks promising and could be a year of solid economic performance. In our baseline scenario, we expect most of the supportive factors at work in 2025 to continue to play a role in 2026.

Avalanche struggles near $12 as Grayscale files updated form for ETF

Avalanche trades close to $12 by press time on Wednesday, extending the nearly 2% drop from the previous day. Grayscale filed an updated form to convert its Avalanche-focused Trust into an ETF with the US Securities and Exchange Commission.