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NZD/USD uncomfortably high by December - Westpac

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Oct 30, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Guatemala) - Analysts at Westpac explained that the RBNZ listed a number of swing factors it will be watching between now and December.

    Key Quotes:

    "These included uncertainty about interest rates in the United States, whether the recent rebound in dairy prices would be sustained, developments in the Auckland housing market, and the exchange rate.

    It was the last of these, comments on the exchange rate, which particularly caught our eye. Exchange rate developments were explicitly linked to interest rate decisions. The RBNZ said that if the NZ dollar sustained its recent rise, “a lower interest rate path than otherwise” would be required.

    Our view is that the NZ dollar will remain uncomfortably high come December, convincing the RBNZ that a December rate cut is required to bolster the inflation outlook."
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