Intraday Market Thoughts

Archived IMT (2009.02.02)

by Ashraf Laidi
Feb 2, 2009 16:54

The RBA is widely expected by market consensus to cut rates by 100-bps to 3.25% on Tuesday morning, bringing rates below those of NZ. Last week's 150-bp rate cut from the RBNZ to 3.50% took rates below those of Australia for the first time in 10 years. The RBA will have to cut by 100-bps to keep its rates below the RBNZ's. Despite weak Aussie data on CPI, confidence and GDP, I see the possibility for a smaller than expected 75-bp rate cut to 3.50%, which is likely to boost AUDNZD back towards 1.28 and 1.960. A 100-bp cut is likely maintain AUDNZD supported at 1.21. AUDUSD support stands at 0.628. NEW HOTCHART is UP.


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