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  • AUD/USD tracks the New Zealand dollar higher, trades well above 0.73.  
  • RBNZ dashes hopes for negative rates, easing pressure on the RBA to add more stimulus.  

The AUD/USD pair is gaining altitude alongside a rally in the New Zealand dollar  and amid a pro-risk environment in financial markets.  

The currency pair is currently trading at 0.7318, representing a 0.5% gain on the day, having picked up a bid at 0.7275 in early Asia.  

The AUD, a commodity dollar, seems to be benefitting from the notable bullish action in the commodity-sensitive New Zealand dollar. The Kiwi is trading at 20-month highs near 0.67 with the money market pricing out prospects of the Reserve Bank of New Zealand (RBNZ) cutting rates to sub-zero levels in 2021. The central bank’s head Adrian Orr said early Wednesday that the economy has been more resilient than previously expected and there is less urgency to implement negative rates.  

With the RBNZ dashing hopes for negative rates, there will be less pressure on  the Reserve Bank of Australia to take the sub-zero route in interest rates.  

Apart from monetary policy expectations, hopes for coronavirus vaccine and the uptick in the global stock markets is likely powering gains in the Aussie dollar. According to  US Health Official Dr. Anthony Fauci, Moderna is likely to join the league of Pfizer-BioNTech in launching the coronavirus vaccine. The futures tied to the S&P 500 are currently reporting a 0.4% gain on the day.  

Technical levels