AUD/NZD remains sideways around 1.1150 ahead of Australian GDP data

• AUD/NZD is juggling around 1.1150 as investors await Australian GDP numbers.
• A significant improvement is expected in GDP numbers despite soaring price pressures.
• Australian OCR has elevated to 2.85% after the RBA announced the fourth 50 bps rate hike.

The AUD/NZD pair is displaying a lackluster performance as investors are awaiting the release of the Australian Gross Domestic Product (GDP) data. The asset is oscillating in a narrow range of 1.1140-1.1160 and is likely to continue a subpar performance ahead.

On Tuesday, the cross remained in a topsy-turvy mode despite the announcement of a 50 basis point (bps) interest rate hike by the Reserve Bank of Australia (RBA). RBA Governor Philip Lowe announced a fourth consecutive rate hike by 50 basis points (bps). Australia’s Official Cash Rate (OCR) now stands at 2.35%.

According to RBAWatch, markets are wagering rates could peak around 3.85% next year. Also, the inflation rate, which is currently at 6.1%, recorded for the second quarter of CY2022 is likely to top 7% by Christmas. Led by soaring price pressures, households are forced to make higher payouts despite an unchanged consumption pattern and operating margins for corporate have trimmed sharply due to inflation-adjusted inputs. Also, the corporate has failed to pass on the impact of higher input prices to the end consumers.

As per the consensus, the Australian economy will grow by 1% on a quarterly basis vs. 0.8% recorded in the prior quarter. Also, the yearly data is expected to improve to 3.5% vs. 3.3% recorded earlier. A higher-than-expected growth rate will strengthen the aussie dollar against kiwi.

This week, a light economic calendar will hold the tier-2 data responsible for guiding the kiwi dollar. Investors’ focus will remain on the Electronic Card Retail Sales data. A higher print will strengthen kiwi against aussie. Earlier, the economic data landed at -0.5% and -0.2% on a yearly and monthly basis.