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AUDNZD not expected to break near-term 1.093-1.13 - TDS

FXStreet (Bali) - Annette Beacher, FX Strategist at TDS, notes that the AUDNZD is not expected to break out of its near-term 1.093-1.13.

Key Quotes

The AUDNZD is not expected to break out of its near-term 1.093-1.13 range with both the RBA and RBNZ expected to remain on hold for many months as both face low commodity prices and low inflation. Support at the 100d ma is 1.1014.

Similarly, CFTC non-commercial positioning is already heavily skewed towards short NZD
Looking ahead, the risks remain tilted towards the NZD weakening vs the AUD."

"The OIS strip is pricing a 66% chance the RBNZ hikes +25bps by September 2015, and could be priced out if RBNZ shifts to an explicit neutral bias."

"By contrast, OIS for the RBA is still insisting on a 35% chance of –25bp at the same time, and pricing out those expectations (to flat) should see the AUD outperform against the NZD by mid-20159 and we target 1.15."

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