AUD/USD: Range-Bound Conditions, Catalysts Needed

The selloff in the AUD on the aftermath of the dovish turnaround by the RBNZ was a precursor of a market that is getting nervous about the new easing outlook in New Zealand will add further pressure for the RBA to adopt a similar approach and eventually cut rates as the market is pricing. The selloff, however, continues to find stubborn buying interest sub 0.7070 since March 15th, and yesterday’s price action was no exception, leading to a rebound towards 71c and in the process, it reinforces the notion that this is an exchange rate with little life to see the light outside its compressed 7150-7070 tunnel (range) until new fundamental catalysts do stimulate a new narrative.