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The RBNZ slashed rates by 25 basis points to 3.25% and judging by the sharp reaction, the market wasn’t really prepared for the move. Remember, the RBNZ was one of the first to hike rates but this move has swiftly unravelled over the past few months. While NZD/USD is the pair most would have been watching on the back of the news as the pair traded at five year lows, AUD/NZD turned out to be the pair to watch as the AUD also responded to local jobs numbers. A surprise higher in domestic jobs numbers saw the AUD jump particularly against the NZD which struggled on the back of the rate cut. AUD/NZD was fast approaching parity just three months ago but managed to bounce strongly and has now surged through 1.1000. Along the way, the pair broke a downtrend which has been in place since March 2013 and came in at around 1.0800. Additionally, the pair is trading above a 61.8% retracement of the slump from November to April. This fresh break could see the pair test November highs in the 1.1300 region.