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Forex Flash: AUD/NZD to keep falling into a lower 1.15-1.20 range - UBS

FXstreet.com (Barcelona) - The AUDNZD hit a new three year low last week below 1.21. According to UBS, "we expect the exchange rate to keep declining into a lower 1.15-1.20 range this year."

First, the Reserve Bank of Australia continues to have an easing bias, says UBS, while in contrast, "the Reserve Bank of New Zealand kept interest rates unchanged at 2.50% at this month's meeting, but it bucked the global trend by signalling the risks were on the upside now by dropping the phrase 'there are both upside and downside risks to this outlook' from its statement."

Continuing on the RBNZ stance, UBS suggests "this suggests the next move in rates eventually will be up. As a result we think the outlook for AUDNZD remains bearish."

Forex Flash: Good case for weaker JPY over the years ahead - RBS

On the back of last Friday's BoJ semi-annual Outlook for Economic Activity and Prices, as Greg Gibbs, currency strategist at Royal Bank of Scotland, notes, "they forecast CPI inflation (less fresh food) at +0.7% by end March 2014, 1.4% by end March 2015 and 1.9% by end March 2016 (excluding the effects of the proposed consumption tax hikes)."
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Forex: USD/JPY continues to trade lower, breaks through initial support of 97.55,

The USD/JPY is trading down 55 pips at 97.38 last. The pair was unable to hold last Friday’s low (97.55) and now appears to be set for a test of 96.60 (lower end of trading range).
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