China’s Growth Faces Structural Challenges Amid Doubts Over Data 
Australia Bans Card Payment Surcharges Starting October 2025 
Bank of Japan Governor Signals Accommodative Stance Amid Negative Real Rates 
RBNZ Holds Rates at 2.25% as Middle East Conflict Fuels Inflation Concerns 
Bank of America Posts Strong Q4 2024 Results, Shares Rise 
Bank of Japan's Ueda Flags Low Real Interest Rates as Key Factor in Rate Hike Timing 
Japan Inflation Expectations Rise as BOJ Rate Hike Timing Faces Uncertainty 
UBS Projects Mixed Market Outlook for 2025 Amid Trump Policy Uncertainty 
Federal Reserve Probes Big Banks Over Private Credit Exposure Amid Growing Systemic Risk Concerns 
US Futures Rise as Investors Eye Earnings, Inflation Data, and Wildfire Impacts 
Singapore Tightens Monetary Policy Amid Middle East War Inflation Risks 
Paraguay Holds Interest Rate at 5.5% as Inflation Remains Stable Amid Global Uncertainty 
Bank of America Maintains Forecast for Two Fed Rate Cuts in 2026 Despite Inflation Risks 
UBS Predicts Potential Fed Rate Cut Amid Strong US Economic Data 
RBI Clamps Down on Rupee NDF Activity, Banks Face Steeper Losses 
Bank of Korea Governor Nominee Warns of Action if Korean Won Weakens Further 
The GDT dairy auction overnight resulted in a 5% rise overall, with WMP up 3% and SMP up 10%. The result is roughly in line with earlier futures predictions which had priced in a response to weather affected supply.
AUDNZD upswing momentum starting to turn positive, we target 1.0700+ during the days ahead.
The pair’s prospects in next 1-3 months: Higher to 1.0750 or above, the RBA likely to remain on hold this year while the RBNZ should ease further. Moreover, the cross remains well below fair value estimates implied by interest rates, commodity prices, and risk sentiment.
OTC updates and Options Strategy:
1m at the money implied volatilities of 50% delta calls and puts are trading at around 7-8% which is reasonable as the vols currently are working in the interest of option holders as you can see IVs and corresponding movements in vega.
As a result of the above economic and monetary policy events, the kiwi dollar was lower against the Australian dollar, with AUDNZD edging up at 1.0616, as all key resistance levels are broken, the further upside can’t be ruled out and it is likely to spike higher on account of the NZ central bank further easing cycle is forecasted.
Well, in order to arrest this upside risk and to bet even on abrupt dips, we recommend option strap strategy that favors underlying spot’s upside bais.
You can trade the IV value by monitoring an IV chart for a specific underlying market for a certain time period and determine the IV range. The peaks suggest the option is expensive to buy and the troughs suggest the option is inexpensive.
So, we recommend building the FX portfolio exposed to this pair with longs positions in 1 lot of 2W ATM 0.51 delta call, 1 lot of 1m (1%) OTM 0.36 delta call and 1 lot of ATM -0.49 delta puts of 2w tenor.
Since we anticipate upswings in near term as per the signals generated by technicals as well as from IVs and risk reversals, this AUDNZD option straps strategy should take care of both upswings and any abrupt downswings, and the strategy is likely to derive handsome returns on the upside and certain yields regardless of swings on either side as shown in the diagram.
