FOREX: NZD Rebounds From Post RBNZ Lows, HK/China Equities Firmer
The USD is off earlier highs, with NZD rebounding from post RBNZ lows. We were last near 1289.75 for the BBDXY, still little net change for the session.
- NZD/USD got to lows of 0.5678 in the aftermath of the RBNZ easing decision. The central bank cut rates by 50bps as forecast and the statement indicated further easing was coming.
- We sit higher now, last near 0.5710/55, a +0.55% rebound from earlier session lows. RBNZ Governor Orr has stated in his press conference that 25bps cuts at the next policy meetings (April and May) is likely if the economy evolves as expected.
- NZD/USD seemed to react to these comments, with the market maybe looking for a faster easing pace, although Orr's comments are broadly consistent with the earlier OCR projections. The other factor in play for NZD was the rebound in Hong Kong and China equities. The HK HSI tech index was down 2.3% but rebounded back into positive territory.
- AUD/USD is also up from lows, the pair last near 0.6355, after earlier lows of 0.6342. The Q4 wages data released earlier didn't shift FX sentiment. The AUD/NZD cross got to highs of 1.1175 post the RBNZ, but now sits close to session lows, last near 1.1125/30.
- USD/JPY is little changed for the session, last close to 152.05. We heard from board member Takata earlier, who stated that further gradual policy adjustments were likely.
- The equity tone has also likely influence yen from a cross standpoint. NZD/JPY got to lows of 86.17 earlier, but we now sit back at 86.80/85.
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ASIA STOCKS: China & Hong Kong Equities Rallies Follow Trump & Xi Jinping Call
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