Westpac economists are negative on the kiwi for the coming week, expecting the 0.6925 low hit on June 18 to be breached. According to Westpac, the major risk event in the near future is payrolls in the United States.
“We expect the 0.6925 low made on June 18 to be tested this week, thus we’re bearish.” After that, a break would signal 0.6800, where we’d seek for buying chances.”
“The key risk in the immediate term will be the US payrolls report on Friday, which is expected to show a good outturn, supporting the USD.”
“The RBNZ should reinforce its new hawkish position later this month.” Inflation figures from the Consumer Price Index (CPI) should also skyrocket (surveyed pricing intentions have surged).
“Longer term, we remain bullish on the NZD/USD, with a target of 0.74 by the end of the year.”
“Domestic fundamentals remain positive, with NZ-US yield gaps widening due to the RBNZ’s more hawkish stance (in comparison to the Fed) and NZ commodity prices projected to continue high for the rest of the year.” As economies recover, global risk sentiment should remain elevated.”/n
