AUDNZD: Testing 20-day EMA Support Post RBA
The AUD/NZD cross sits back near 1.0840 in latest dealings around session lows. This puts us back under the 20-day EMA, see the chart below. Recent highs were marked at around the 100-day EMA, close to 1.0920.. The earlier RBA cut, along with trimmed inflation and growth forecasts has weighed on the cross in latest dealings. RBA Bullock also stated the RBA considered a 50bps cut, which has weighed further on the AUD. Downside focus for the pair may rest with a test back under 1.0800 (note earlier May lows in the pair were at 1.0760).
- The AU-NZ 2yr spread is back off recent highs last near +27bps. We were around +45bps close to a week ago.
Fig 1: AUD/NZD Versus Key EMAs
Source: MNI - Market News/Bloomberg
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| Date | Time | Country | Event |
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| 29-Apr | 0700 | DE | GFK Consumer Climate |
| 29-Apr | 0800 | ES | HICP (p) / GDP |
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| 30-Apr | 0900 | IT | GDP (p) |
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JGBS: Twist-Steepener Holds Going Into W/E, BoJ Gov Ueda Reiterates Caution
JGB futures are stronger, +18 compared to settlement levels, sitting near the middle of the range after a choppy session.
- “Governor Kazuo Ueda reiterates his stance that the central bank will carefully monitor if its economic outlook will be realized, accounting for the effects of US tariff measures, without preconception. The BoJ will raise the benchmark rate if the outlook is realized, Ueda says in response to questions in parliament.” (per BBG)
- “Fukoku Mutual Life Insurance Co. plans to invest in Japan's super-long government bonds this fiscal year after their yields skyrocketed. The company aims to increase domestic government bond holdings by ¥30 billion, with gross purchases potentially reaching ¥300-400 billion.” (per BBG)
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- Cash JGBs have twist-steepened, pivoting at the 20-year, with yields 2bps lower to 5bps higher.
- Swap rates are 2bps lower to 2bps higher, with a steepening bias.
- On Monday, the local calendar will see Tokyo Condominiums for Sale data.
