AUD/NZD holds near long-term highs above 1.2200 amid hot Australian CPI

AUD/NZD surged to 1.2230 — its highest level since April 2013 — after Australia’s monthly CPI accelerated sharply, boosting the Australian dollar versus the New Zealand dollar. Headline CPI rose to 4.6% year-on-year and 1.1% month-on-month in March, lifting market bets that the RBA will resume rate hikes at its May 5 meeting. The pair later eased back to around 1.2200 but remains near long-term highs. The data increases pressure on the RBA’s policy committee and contrasts with a New Zealand backdrop where markets are pricing a likely RBNZ hike around July. Overall, the inflation surprise is bullish for AUD and has driven renewed rate-hike expectations, underpinning the AUD/NZD advance.