The AUD to NZD exchange rate has a bearish market bias in the near term.
Key drivers for this trend include:
- The Reserve Bank of Australia (RBA) is signaling potential interest rate hikes, which could initially support the AUD. However, recent weaker economic indicators from China are dampening demand for Australian exports, notably iron ore.
- The Reserve Bank of New Zealand (RBNZ) has cut interest rates, which generally makes the NZD less attractive to investors, yet concerns over global trade tensions weigh on the currency.
- Domestic growth outlooks for both countries remain uncertain, with upcoming economic data releases expected to be pivotal for the AUD.
In the near term, the AUD/NZD pair is likely to trade within a stable range above its recent average. Upside risks could arise if Australia’s economic indicators surprise positively, while downside risks may stem from persistent global risk-off sentiment and commodity price declines.