BNZ: bullish on NZD/USD
NZD/USD has made the most spectacular gains this week on the Fed’s inaction. Analysts at Bank of New Zealand think that the gains in New Zealand’s currencies will be sustained. The specialists recommend buying kiwi on the dips. The ‘buy zone’ may have moved up from around $0.7700 to around $0.8000. Momentum is positive and a short-term NZD/USD ‘fair-value’ range is at $0.8100/8700, so the bank doesn’t out a test of $0.8600/8650 over the next few weeks.
“To the extent that the latest bout of currency strength is sustained, this increases the risk that the Reserve Bank of New Zealand will be forced to push its rate forecasts back down again. A delayed schedule of RBNZ rate hikes may help to limit the extent of NZD appreciation we see from here,” BNZ argues.
Chart. Daily NZD/USD