AUD/NZD Breaks Higher as RBNZ Surprise Widens RBA Policy Divergence
AUD/NZD surged through 1.2489/93 resistance after two policy shocks 30 minutes apart: Australia's CPI jumped to 4.3%, reinforcing a November RBA hike, while the RBNZ unexpectedly held at 2.75% in a narrow 4–3 vote. The move is overwhelmingly an NZD story—not an AUD one—with the cross now targeting 1.2624 and potentially 1.2845.
Euro Weakest as French Bond Spreads Widen Again; Australian CPI and UK Budget Next
Euro returned to the bottom of the major-currency ranking on Tuesday as renewed pressure on French government bonds partly reversed Monday’s relief. France’s 10-year yield rose 5.2bps to 4.955% while the German Bund yield fell 3.1bps to 3.339%, widening the OAT–Bund spread from around 153bps to 162bps. Spanish, British and US yields also declined, so the move was French-specific.
France Avoids Downgrade, but EUR/GBP and EUR/CHF Face Fresh Downside Tests
Moody's kept France's Aa3 rating with a negative outlook, and French bonds rallied Monday—yet Euro saw little relief, with EUR/GBP and EUR/CHF still trading near key support. The narrowing OAT-Bund spread hasn't translated into a Euro rebound, suggesting markets still see France's fiscal risk as unresolved rather than cleared.
Five Central Banks, Tech Earnings and Oil Risks Set Up a Week of Cross-Market Repricing
Global financial markets face an unusually concentrated series of catalysts this week: the RBNZ, BoC and Fed decide on Wednesday, the ECB on Thursday and the BoJ on Friday, alongside earnings from Alphabet, Microsoft, Amazon and Intel, key inflation and growth data, and renewed geopolitical uncertainty around oil supplies. US 10-year Treasury yields are hovering around 5%.
