MUFG Research sees a scope for further AUD/NZD decline over the coming weeks.
“With the RBA displaying more concern over weaker growth alongside
higher inflation, the updated statement will further encourage
expectations that the RBA is moving closer to the end of their rate hike
cycle. The RBA still reiterated that they expect to raise rates further
over the period ahead. We expect another 25bps hike in December which
could prove to be the last hike in the cycle if global growth fears
intensify heading into next year,” MUFG notes.
“The dovish Australian rate market reaction to the RBA’s
policy update has contributed to the Australian dollar extending its
recent sell-off against the New Zealand dollar. The AUD/NZD rate is
attempting to close below support for the 200- dat moving average for
the first time since the end of last year,” MUFG adds.
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