New Zealand Q3 inflation has risen at its fastest pace in 10 years with the latest release to start the FX week. The annual inflation rate moves up to 4.9% from 3.3% in the second quarter. This has caused the New Zealand bond yield to rise sharply higher as expectations now increase for a 50 bps rate hike at the next RBNZ rate meeting, Will this help lift the NZDJPY pair even further?

Over the last 10 years, the NZDJPY has risen eight times between October 18 and December 01. The average gain has been + 3.33%. The largest gain was +09.29% in 2020 and the largest loss was -4.44%.

Major Trade Risks: The main risk to this trade is if risk-off trading sends safe-haven flows into the JPY.