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NZD/USD: Break above 0.6790 to give way to a move higher to around 0.6900 - Westpac

FXStreet (Delhi) – Imre Speizer, Research Analyst at Westpac, expects near-term resistance for NZD/USD at 0.6790 to give way to a move higher to around 0.6900.

Key Quotes

“The RBNZ's MPS was hawkish relative to market expectations, and the NZ event calendar this week should be supportive.

The key data releases are Q3 balance of payments (Wed) and Q3 GDP (Thu). We estimate the latter rose by 0.9%, a payback for a soft H1. There’s also business confidence (ANZ, Fri), and the GDT dairy auction (Tue). Whole milk powder futures markets are predicting an 8% rise. The mid-year fiscal update is unlikely to be market moving.

3 months ahead: Once the current rally has run its course (by 0.69), we markets should take heed of the less upbeat data expected over the next few months. The resultant policy divergence between the Fed and the RBNZ should push NZD/USD towards 0.63.

1 year ahead: Our 1 year ahead forecast is 0.62, based partly on the OCR being cut to 2.0%.”

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