FXStreet (Delhi) – Imre Speizer, Senior Markets Strategist at Westpac, suggests that according to their short term fair value model for NZD/USD shows it remains undervalued by around 6 cents, as it has been for the past month. Key Quotes “Our fair value range is 0.71-0.72, based on the NZ-US interest rate spread, commodity prices and risk sentiment.” “Significant NZD/USD undervaluation has persisted since mid-2015. One explanation is the US dollar’s overvaluation, markets pricing more Fed tightening into the US dollar than is implied by US interest rates.” “NZ dairy prices risk bouncing at the next auction on 1 Dec. The front WMP futures contract is predicting a 13% rise at this juncture, and more distant contracts are pointing to a steep price curve. Coming on the back of a large surge in prices from August and then a sharp fall from October, this suggests markets are trying to find an equilibrium ahead of a looming El Nino-induced drought.” For more information, read our latest forex news.