Forex Investment and Currency Trading

AU vs NZ rates
Individually, AUD and NZD are more sensitive to market demand for high yielders and drivers of this, such as risk appetite, than to their own interest rate dynamics, But the AUD/NZD cross is another story, as are the crosses between pairs of funding currencies. The depreciation of AUD/NZD since
late-June/early-July is primarily explained [...]

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AUD/NZD’s inability to push higher in the past week, especially post the RBNZ’s 50bps rate cut to 7.50% has puzzled many.
AUD/NZD’s decline seems counter intuitive; one would think that the currency with the inferior relative “fundamentals”, such as relative GDP growth and current account profiles (i.e.: NZD), would underperform, yet this has not held recently.
If [...]

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The extent of NZD’s downside since the RBNZ cut rates last week has been surprisingly shallow. The most recent data from the TFX gives an insight into why. Japanese margin traders have been very good buyers on the recent NZD sell-off. Even as NZD/USD sold off from around 0.7725 to 0.7310, net NZDJPY longs on [...]

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