• AUD/NZD sticks to a positive bias after the RBA decided to leave interest rates unchanged.
• The divergent RBA-RBNZ policy outlooks remain supportive of the ongoing momentum.
• Any corrective pullback could be seen as a buying opportunity and is likely to be limited.

The AUD/NZD cross retreats a few pips from the vicinity of the 1.1500 mark, or the highest level since September 2022, touched during the Asian session, after the Reserve Bank of Australia (RBA) announced its policy decision. Spot prices, however, remain in positive territory for the seventh straight day and currently trade above mid-1.1400s, up around 0.15% for the day.

The RBA, as was anticipated, left the official interest rate unchanged in the wake of a surprise rebound in inflation. Moreover, the RBA revised its inflation forecast and now sees it jumping to 3.7% by mid-next year before easing to 2.7% by December 2026 and to 2.6% by the end of 2027. The outlook further tempered bets for another RBA rate cut in the next 12 months, which, in turn, is seen as a key factor behind the Australian Dollar's (AUD) relative outperformance against the Kiwi.

Despite annual inflation sitting at the upper limit of the Reserve Bank of New Zealand's (RBNZ), traders have been pricing in a greater chance of another rate cut at the November 26 meeting. Moreover, RBNZ Monetary Policy Committee member Prasanna Gai said on Friday that US tariffs are a negative demand shock for New Zealand and noted that these tariffs are acting as headwinds to the already restrained growth. This continues to undermine the New Zealand Dollar (NZD)

The aforementioned fundamental backdrop supports prospects for a further near-term appreciating move for the AUD/NZD cross. That said, oscillators on the daily chart have moved on the verge of breaking into the overbought zone and warrant caution for bullish traders. Hence, it will be prudent to wait for some near-term consolidation or a modest corrective pullback before positioning for further gains. Nevertheless, the path of least resistance for spot prices remains to the upside.