AUD/NZD Holds Near Long-Term Highs Above 1.2200 as Hot Australian CPI Ignites Rate Hike Fears

AUD/NZD is trading near long-term highs above 1.2200 after Australia’s CPI unexpectedly rose to 4.2% (core 3.9%), sharply lifting market pricing for an RBA rate hike. Futures now imply a roughly 65% chance of a May hike (up from 30%), boosting the AUD against the NZD amid policy divergence with the RBNZ. The pair sits around 1.2215, having broken the 1.2200 resistance, with technicals (RSI ~68 and a 50/200-day golden cross) signaling upside but also risk of a pullback. A daily close above 1.2250 would confirm a breakout toward 1.2300; traders should watch the RBA meeting on May 6 for event risk and use stops (suggested support ~1.2150) given potential volatile reversals.