Sellers take control of AUD/NZD, pushing the pair to 1.0860 and clearing the recent gains
The AUD/NZD sellers took charge on Tuesday, wiping out all the daily gains and pushing the pair to 1.0860. This move comes ahead of key data releases from both Australia and New Zealand, which are expected to provide further guidance on the direction of the two economies.
In New Zealand, all eyes are on the June ANZ consumer and business surveys set to be released on Wednesday. The Reserve Bank of New Zealand (RBNZ) is planning its first rate cut for Q3 2025, which goes against market expectations of a cut in November. The upcoming data will play a crucial role in determining the pace of future rate cuts, with the possibility of earlier cuts if the economy shows signs of weakness.
Meanwhile, in Australia, the recent rise in the Westpac Consumer Confidence data has drawn attention, indicating a slight improvement in consumer sentiment. However, the focus remains on the release of the May Consumer Price Index (CPI) data on Wednesday, which is expected to provide further insights into Australia’s economic direction.
The swaps market currently shows less than 25% odds of a rate cut by December 2024, increasing to around 65% by February 2025. Despite expectations of a slight increase in inflation figures, the Reserve Bank of Australia (RBA) remains patient, emphasizing the need for sustained inflation within the 2-3% target range.
From a technical perspective, the near-term outlook for AUD/NZD remains positive, with indicators hinting at a potential consolidation of recent gains. The pair is holding above key moving averages, with the 20-day SMA completing a bullish crossover with the 100-day SMA, reinforcing the positive sentiment.
Overall, the AUD/NZD pair is awaiting key data releases from both countries to provide further clarity on the economic outlook and potential market movements. Investors will be closely monitoring the upcoming releases to gauge the future direction of the currency pair.
