A sharp recovery for the NZD
• The NZD and AUD enjoyed very strong gains from mid-Jan as the USD collapsed and a global reflationary thematic prevailed
• Investors’ loss of trust in US policy exaggerated market movements alongside the end of the rules-based international order
• Global equity markets stretch to fresh highs; US Treasuries range-bound; NZ-global rate spreads increase
An uneventful close to 2025
• Market price action over the first three weeks of December was modest, with a lack of key drivers to perturb investors
• The bias to global rates was to the upside on a view of maturing rate cutting cycles
• The USD was broadly weaker; NZD/USD showed a small gain and NZD cross movements were also small
November a net nothingburger
• Markets were well contained in November, with little net change across global equities, rates and currencies
• The NZD hit fresh lows during the month, before recovering after a more hawkish RBNZ policy update than widely expected
• Higher conviction on the end of easing cycles saw both NZ and Australian rates higher, against the global trend