AUDNZD looks weak as bond yield spread dives lower
The Aussie 10 year and New Zealand 10 year spread has dived lower again. This is in keeping with the divergent outlook between the RBA and the RBNZ. A puzzle over the last two weeks has been NZD weakness despite a more hawkish tilt from the RBNZ. This has made the AUDNZD a pain to trade/
However, it now looks like the bond yield spread dipping will drag this pair lower from major resistance. Look out below. Remember the bond yield spread is a kind of 'relative performance proxy' for each economy. When the bond yield spreads dip, so too does the price. Just put the quote bond first when plotting the spread , in this case AU10Y.