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AUD/NZD under valued - Westpac

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Nov 9, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Guatemala) - Analysts at Westpac suggest that AUD/NZD is undervalued.

    Key Quotes:

    "Last week's sharp fall in NZD/AUD brought it much closer to fair value (which currently sits at 0.90).

    "Our short term fair value model uses commodity prices, interest rates, and global risk sentiment to explain the cross (chart across). Relative commodity movements say the cross is around the right level."

    However, interest rate movements say the cross has further to fall. Will this “misalignment” be rectified in the near term? Don't hold your breath – it has been persistently overvalued since January."
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