Central Bank

The consensus is 50bp, market pricing leans towards 75bp. Whatever the RBNZ decide to do today, it comes down to whether they will signal further cuts, as to whether NZD/USD continues to depreciate or bounce on a "sell the rumour, buy the fact" reaction.

The USD bullish rally continued to rage after Powell bluntly said that the Fed may not be in a hurry to cut rates, citing a strong labour market and a "remarkably strong" economy.

With Kashkari throwing the word ‘pause’ into the mix ahead of a US CPI report, traders should brace themselves for further USD gains should it come in hotter than expected.

We finally get a bit of a breather from the US election and can shift out attention to today’s BOE and FOMC meetings, making it an ideal time to catch up on GBP/USD.

AUD/JPY looks to Wall Street for its next directional move while NZD/USD is down for a fifth day ahead of tomorrow's RBNZ meeting. But if they fail to deliver a dovish 50b cut, it could prompt profit taking from bears and weigh further on AUD/NZD.

The USD is surging and markets are betting that the RNZZ could cut rates by 100bp by December. Failure to do hint at such a move could see AUD/NZD track AUD/USD lower.

Next week brings three major central bank meetings, none of which seem to be on the same page policy wise. The Fed are expected to cut by 25bp and potentially set the record straight on another ‘50bp’ cut November, whereas there’s also an outside chance the BOJ may surprise with an interest rate hike given their renewed hawkish narrative. And while the Bank of England are expected to hold rates, a soft set of inflation figures could bring forward bets of a November cut.

NZD/USD has risen towards resistance despite speculation that the RBNZ could cut their cash rate by 25bp tomorrow, from 5.5% to 5.25%. And not for the first time, money markets and economists disagree.

Two RBA speeches and a monetary policy decision along with updated RBA forecasts are the highlights of the week for AUD/USD traders on the domestic front. Although risk-off tones and an ISM services report could prove to be the bigger drivers.

While the BOJ hiked more aggressively than expected, they fell short on their ETF tapering, rattling the yen during a bout of 2-way volatility. And the risk of volatility remains with a looming FOMC meeting.

Harris replacing Biden may not be a radical overhaul where policies are concerned, but it has certainly brought the Democrat’s prospects for maintaining power back from the brink of death. From a market perspective, it means Trump is no longer a ‘walk in’ President, and political headlines from the US are no longer driving sentiment for now. Thankfully, we have intertest rate decisions from the FOMC, BOE and BOJ to drive sentiment, along with NFP and Australia’s CPI report for good measure.