AUD/NZD drops hard on Orr's 'one-big-one and-done' 50 basis point cut rhetoric

• AUD/NZD drops in proximity of the daily ATR of 56 on less dovish RBNZ.
• The downside targets are 1.0535 where the 23.6% Fibo.

AUD/NZD has dropped significantly in Asian trade on the back of less dovish comments from the Reserve Bank of New Zealand's governor Orr who has repeated much of what the assistant governor had said the prior session. AUD/NZD is down -0.38% for the session at 1.0571, down from a high of 1.0614 and ha marked a low of 1.0568. 

RBNZ Orr has said that while the central bank will do whatever it takes to support the New Zealand economy, the rate cut reduces probably of having to do more later.

Key comments:

• We can afford to wait, watch and observe what’s happening.
• Inflation expectations is an important signal to watch.
• Rate cut reduces probability of having to do more later.
• Rate reduces probably of having to do more later.
• Negative can be an impactful tool broadly across the economy. 

The RBNZ assistant governor voiced the same yesterday, and today, said if monetary policy is to be successful for a further 30 years "we need to confront challenges of stubbornly low inflation, interest rates." All in all, this should give life back to the bird for the near term as the markets are heavily short of the kiwi. 

AUD/NZD levels

AUD/NZD has comes into close proximity of the daily ATR of 56 pips having dropped over 40 pips on the move. The downside targets are 1.0535 where the 23.6% Fibo meets prior resistance and support levels on a swing basis. This has left the potential for a daily double top at 1.0616.