AUD/NZD bears eye a break of trendline support

• AUD/NZD has corrected in a 50% mean reversion ahead of key data events.
• Bears are looking for a break of the trendline support and structure at 1.0952.

AUD/NZD is flat on the day so far ahead of the release of the Monetary Policy Statement from the Reserve Bank of New Zealand today that is expected to see another 50bp lift in the OCR to 3.0%. The cross has been stalling on the bid within familiar ranges. AUD/NZD has stuck to 1.1057 and 1.1069 on the day.

''We are expecting a hawkish tone today as the RBNZ tries to reiterate the battle to bring down surging inflation is far from over. Upside surprises in domestic inflation and wage growth, along with the recent falls in domestic mortgage rates given the Monetary Policy Committee little choice but to send a clear message,'' analysts at ANZ Bank explained. 

Meanwhile, the Aussie jobs data will be keenly monitored tomorrow whereby analysts at TD Securities said ''wages growth may accelerate in Q2 as firms face record labour constraints while workers may demand higher base wages with inflation at a 21-year high.'' The analysts added ''July is a seasonally strong month for job gains and we look for the unemployment rate to trend lower. Another strong labour print should give the RBA the assurance that the economy can withstand a cash rate of 3% by end-2022.''

AUD/NZD technical analysis

The price has corrected in a 50% mean reversion and should the bears now move in, then a break of the trendline support and structure at 1.0952 will be a significant development.