NZD/USD remains in a multi-week downtrend - Westpac

Imre Speizer, Research Analyst at Westpac, notes that the NZD/USD remains in a multi-week downtrend, although it has stalled at 0.6705.

Key Quotes

“We see potential for that level to give way during the week ahead, not least because markets are currently repricing OCR expectations in a downward direction, having earlier priced in a paltry 15% chance of a June cut. Fonterra’s disappointingly low opening milk payout forecast will encourage such repricing.

Further ahead, it could be a rocky road until markets embrace Fed tightening with more vigour. Nevertheless, we are sticking with our view that eventual Fed tightening, combined with a loose RBNZ, should result in a lower NZD/USD around 0.65 by Q3.”