NZD/AUD: Momentum Could Take the Cross to Around 0.9350 – Westpac
NZD/AUD: Momentum Could Take the Cross to Around 0.9350 – Westpac
Imre Speizer, Senior Market Strategist at Westpac, suggests that the
momentum could take the NZD/AUD cross to around 0.9350 this week but
more likely is a period of consolidation between 0.9100 and 0.9300.
Key Quotes
“Markets
have priced both the RBA and RBNZ as 80% chances for a rate cut during
the next few months, so there is little choose between the currencies
from an interest rate pricing perspective.
It’s a quieter AU
calendar this week. Westpac May consumer sentiment is on Wed. Housing
finance, the last of the March releases, is out the same day.
3 months:
We target 0.88 multi-month because the cross is trading well above fair
value implied by relative interest rates, commodities and risk
sentiment. A major risk to this view would be a global shock (for
example from China), those typically affecting the AUD more than the
NZD.
1 year: Our economic fundamentals based forecast is 0.87.”
