Insights 
VT 
AUD/NZD trades around 1.1550 after RBA’s Hauser’s cautious comments. Hauser noted that a policy shift from restrictive could affect future decisions, while NZD weakens as a 25-basis-point RBNZ rate cut looms.
The currency cross remains steady after losses of more than 0.25% in the previous session, currently near levels last seen in September 2013. The Australian Dollar may gain strength amid the RBA’s outlook, with Consumer Confidence rising 12.8% in November to 103.8.
Nzd Rate Cuts Pressure
NZD faces pressure due to likely RBNZ rate cuts, with a 10% chance of a deeper 50-basis-point cut, as the economy nears recession. RBNZ Inflation Expectations remained at 2.28% for Q4, within the target range.
The Reserve Bank of Australia (RBA) manages monetary policy to maintain price stability and supports the AUD through interest rate decisions. Higher inflation often prompts rate increases, attracting capital inflows and boosting the AUD’s value.
Quantitative Easing (QE) and Tightening (QT) impact the AUD differently. QE involves asset purchases to boost liquidity, generally weakening the AUD, whereas QT involves halting purchases, potentially strengthening the AUD.
We are seeing a clear divergence between Australian and New Zealand monetary policy, creating an opportunity for derivative traders. The Reserve Bank of Australia is signaling a reluctance to ease, while the Reserve Bank of New Zealand is expected to cut its rate to 2.25% later this month. This fundamental split points towards continued strength in the AUD/NZD pair.
Economic Indicators Favor Aud
The RBA’s cautious tone is backed by solid domestic data, which we see as a bullish signal for the Aussie dollar. Australia’s unemployment rate recently fell to 3.8% in the October 2025 report, and the latest quarterly CPI reading came in at 3.1%, just above the RBA’s target band. These figures make it very difficult for the RBA to consider easing policy anytime soon.
On the other side of the Tasman, we see a weakening picture for the New Zealand dollar. New Zealand’s unemployment rate has ticked up to 4.5%, a stark contrast to Australia’s, as the economy struggles after the technical recession we saw earlier in 2025. Consequently, Overnight Index Swaps markets are now pricing in a 95% probability of a 25 basis point rate cut this month.
Given this outlook, we believe traders should consider strategies that profit from a rising AUD/NZD, such as buying call options with expirations in December 2025 or January 2026. The cross recently touched 1.1590, its highest level since 2013, suggesting a significant technical breakout is underway. This move signals strong momentum that could carry the pair higher, especially following the expected RBNZ decision.
