A break of 0.6700, targets 0.6200 by year--end - UOB

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Oct 29, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Mumbai) - Lee Sue Ann at Global Economics & Markets Research, UOB, notes that post the RBNZ decision to remain in a wait-and-see mode, the bearish pressures remain intact on the NZD and a break of 0.6700 support targets 0.6200 by year-end.

    Key Quotes:

    “RBNZ leaves OCR at 2.75%, but says further policy easing still likely. Immediate need for rate cut has diminished as downsides risks to growth have eased; dairy and other soft commodities have risen; inflation is still expected to pick up; and RBNZ probably wants more time to observe the domestic housing market.”

    “In the coming weeks, developments in the global economy, dairy prices and levels in the NZD will be closely eyed. A key point on the domestic front will be the 3Q labour market report on 4 November.”

    “On NZD, the break of 0.6700 is significant and the currency is expected to come under pressure in the coming days. We expect any rebound to hold below 0.6730 but any down-move is unlikely to have enough impetus to break below 0.6620/25. Further out, we hold onto our bearish view, keeping our year-end target of 0.6200, as we expect the RBNZ will most likely act on its easing bias at the next meeting on 10 December.”
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