NZD: fundamentals remain positive - Nomura

Analysts at Nomura explained that in terms of the NZD, the more dovish than expected RBNZ looks set to anchor front-end New Zealand interest rates for a while, and this points to a weaker than anticipated near-term outlook. 

Key Quotes:

"However, we continue to think the RBNZ is too pessimistic on domestic inflation and the global backdrop, and over time the bias is for the bank to shift towards the market. 

This should place a floor under New Zealand two-year swap rates. And when mixed with the solid domestic growth story, rebound in New Zealand-centric commodity prices and softer USD, we are looking for NZD/USD to grind higher over H2, outperform its commodity-bloc peers, but underperform the major European currencies."