Barclays on the antipodean trade

Currency investors should consider selling AUD/NZD this week, advises Barclays Capital FX Strategy Research in its weekly FX to clients.

Barclays recommend a short position from 1.0714, with a stop at 1.0770, and a target at 1.0605.

Barclays promotes this trade ahead of this week's RBNZ meeting on the ground that the market is not positioned for a bullish outcome which Barclays expects from the meeting.

In particular, Barclays expect the RBNZ to have a positive stance in its forecasts and communication this week.

In contrast, Barclays expects the AUD to come under renewed pressure amid still-subdued inflation and continued downside risks to iron ore prices.

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