AUDNZD definition

AUD/NZD is the exchange rate between the Australian dollar and the New Zealand dollar, showing how many New Zealand dollars one Australian dollar will buy. This trans-Tasman cross links two closely related economies, which is why it often grinds within a range rather than trending hard. It is reasonably liquid, but spreads sit above those of the dollar majors.

The Australian dollar is the base currency and the New Zealand dollar the quote currency, so a quote of 1.0900 means one Aussie dollar buys 1.0900 Kiwi dollars. A higher price means the Aussie is outpacing the Kiwi, a lower price the opposite. You trade AUD/NZD as a forex CFD, positioning on the rate rather than holding either currency: go long if you expect the Aussie to lead, short if you expect the Kiwi to. Each pip sits at the fourth decimal place, and your outcome is the number of pips moved multiplied by your position size.

Because Australia and New Zealand are so alike, AUD/NZD trades mostly on the divergence between their central banks, the Reserve Bank of Australia and the Reserve Bank of New Zealand: whichever is more hawkish tends to win. The commodity mix counts too, with Australia leaning on iron ore and New Zealand on dairy, so a swing in one export can tilt the cross. Shared exposure to Chinese demand often cancels out, which is part of why the pair so frequently reverts to a range.