The AUD/NZD pair is the abbreviated term used for the Australian dollar & New Zealand dollar). The Aussie is the nickname of the Australian Dollar, and Kiwi is the nickname of the New Zealand Dollar; however, this pair does not have a nickname.Before we get into the particulars, what exactly does the AUD/NZD rate mean? The exchange rate tells you how many New Zealand dollars (the quote currency) are required to purchase one Australian Dollar (base currency). For example, if the pair is trading at 1.08, it means it takes 1.08 New Zealand dollars to buy 1 Australian Dollar.

Breaking Down ‘AUD/NZD’

The AUD is the abbreviation for the Australian dollar, also known as the Aussie dollar, in the international currency market. Australian Dollar replaced the Australian pound in 1966 and marked its 50th anniversary as a currency in 2016. Apart from this, the Australian dollar is the standard currency not only in Australia but also in several independent countries and territories in the South Ocean, such as Papua New Guinea, Christmas Island, Cocos Islands, Nauru, Tuvalu, and Norfolk Island.The New Zealand dollar (NZD) is the currency of New Zealand. NZD is made up of 100 cents, and this currency is officially represented by the symbol $ or NZ$ to set it apart from other currencies based in dollars. We can use this currency in the Cook Islands, Niue, Tokelau, and the Pitcairn Islands. This currency nickname is kiwi and the reason behind its nickname is the national bird found stamped on the one-dollar coin. The decimalization of the currency took place in 1967 when the New Zealand dollar replaced the New Zealand pound at a rate of two dollars to one pound.The Australian Dollar and New Zealand Dollar cross represents the two Australasian currencies, which usually trade in one direction opposing other currencies as a result of similar geographical locations and high turnover rates. Hence, the cross moves on the actual changes in the local economies and is not profoundly affected by risk-trends or global factors. Commodity exports factor a significant part of both economies, with Australia shipping energy products and ferrous metals, whereas New Zealand is also known for its export of wool, meat, and milk.

What Determines the AUD/NZD Exchange Rate?

The (RBA) Reserve Bank of Australia is the central bank of Australia. The bank issues and maintains the Australian dollar. The RBA is involved in two types of activities, banking and registry services for federal agencies and some international central banks. The bank, is entirely owned by the Australian government, and was established in 1960. Philip Lowe governs the bank. He succeeded Glenn Stevens in 2016.The Reserve Bank of New Zealand or RBNZ is the name of the central bank of New Zealand. Its main objective is to maintain the stability of New Zealand's financial system, Apart from this, it's also responsible for maintaining the monetary policy, meeting the currency needs of the public and providing support services for other banks in the country.

Major Economic Events:

Gross Domestic Product – The Gross Domestic Product is the central measure of economic growth in the region.Employment Change – Both currencies are sensitive to changes in employment, as slacks in the labor market cause a drop in Inflation rates.Consumer Price Index – Since one of the goals of RBA and RBNZ is to maintain price stability, they keep an eye on inflation indicators such as the CPI. If the annual CPI deviates from the central bank’s target, the central banks could make use of their monetary policy tools to keep inflation in check.Political announcements & natural disasters – Besides the scheduled economic events, political elections, new systems, wars, terror incidents, natural calamities, etc. can cause severe variations within AUD/NZD.

Currency Correlations

Correlation is merely a mutual relationship or connection between two or more things.Positive correlation – The positive relationship merely is when pairs move in tandem with each other.In the forex world, the AUD/NZD - GBP/NZD, AUD/NZD - GBP/NOK, and AUD/NZD - USD/THB currency pairs are positively correlated.Negative Correlation – In contrast, a negative relationship is when forex pairs move in the opposite direction. For example, AUD/NZD - USD/THB, AUD/NZD - NZD/CAD, and AUD/NZD - NZD/USD.

AUD/NZD Specifications

Standard lot Size: 100,000 Mini lot size: 10,000 Price minimum increment: 0.00001 Pip Value: $6.30