AUDNZD sell on rallies now?
On Tuesday the RBNZ prompted a sharp spike higher in the NZ 10 year bond yields.
From here the RBA is focuses on keeping short term yields close to the OCR and that could leave AUD yields slightly below NZD yields until there is a dovish shift from the RBNZ. The last shifts from the RBNZ have been bullish. The start of the month had the OIS markets pricing in 40 bps of cuts by the end of 2021 compared to just 5 bps following the latest RBNZ communication.
This opens up AUDNZD sell on rallies.