AUD/NZD down to fresh five-week lows on the day

In terms of central bank divergence, the RBNZ rate hike calls and RBA policy stance today makes for a stark difference between the two at the moment.

And that could be enough to take AUD/NZD down back to its May lows near 1.0600.

The pair is already breaking to fresh five-week lows now below the 61.8 retracement level of its recent upside move last month @ 1.0681.

That now puts pressure towards the trendline support @ 1.0641 before the 27 May low @ 1.0600 comes back into play for the pair.

With market expectations for a RBNZ rate hike rising and the RBA not expected to budge until November at the earliest, there is a tailwind for the kiwi to stay more supportive against the aussie (lower AUD/NZD) on this front – at least for now.

The big caveat though will be how the RBNZ actually responds to all of this talk of them potentially raising rates by November this year.



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