NZD: Posting new lows for little fundamental reason - ING

The kiwi has been quickly dumped by fast-money investors, despite the lack of any meaningful local catalysts, points out the research team at ING.

Key Quotes

“The RBNZ has already told us that the change to a dual-mandate would not affect its policy outlook; the OIS curve continues to price in a full rate hike in late 2H18, which seems fair in our view. The likely factor for the more recent selling may have been negative sentiment towards traditional activity currencies.”

“In the absence of a further downturn in equities, we would expect downside NZD pressure to recede. The kiwi will be looking for some catalysts for support; 3Q retail sales (Thu) and trade data (Fri) may offer some good news. Next key support area for NZD/USD comes in around 0.6750.”