NZD/AUD to target the 0.9075 area multi-week - Westpac

In view of Imre Speizer, Research Analyst at Westpac, the NZD/AUD cross remains under downward pressure, mainly due to the recent slippage in the NZ-AU interest rate spread, which in turn was catalysed by the dovish surprise from the RBNZ MPS and they target the 0.9075 area multi-week.

Key Quotes

“The near-100k jump in Australian employment in 2 months, and the potential for a bounce in iron ore prices – given the sustained rally in Chinese steel prices – are near-term positives for the AUD.”

“The calendar this week is quiet, with Q1 construction work done on Wed. We don’t see the rest of the Q1 partials until early June.”

“3 months ahead: Fair value for this cross has fallen to around 0.90, following this year’s sharp decline in iron ore prices. We see that as a fair target for the remainder of 2017.”