12 Nov 2013
Flash: NZD/USD outlook down, watch break of 0.8190 - Westpac
FXstreet.com (Barcelona) - Despite recent upbeat NZ economic indicators and a hawkish RBNZ, with tightening expected in April, according to Imre Speizer, FX Strategist at Westpac, "NZD/USD will suffer from the resurgence of Fed tapering expectations."
Key Quotes
"US economic data is likely to beat pessimistic forecasts over the next month, which means the US dollar is likely to rise further and NZD/USD is thus likely to fall. A test of 0.8190 is likely, and if that gives way, the selloff could extend to the high 0.70’s."
"The US economy is far from good shape but our US data surprise index is very depressed, suggesting a lot of negative US news has been discounted. Our index is at historical extremes where mean reversion pressures tend to push our surprise index higher as the data starts to beat deflated expectations."
"Longer term, we don’t expect the US dollar rally to continue until early 2014 and we target 0.8600 for NZD/USD by Mar-14."
Key Quotes
"US economic data is likely to beat pessimistic forecasts over the next month, which means the US dollar is likely to rise further and NZD/USD is thus likely to fall. A test of 0.8190 is likely, and if that gives way, the selloff could extend to the high 0.70’s."
"The US economy is far from good shape but our US data surprise index is very depressed, suggesting a lot of negative US news has been discounted. Our index is at historical extremes where mean reversion pressures tend to push our surprise index higher as the data starts to beat deflated expectations."
"Longer term, we don’t expect the US dollar rally to continue until early 2014 and we target 0.8600 for NZD/USD by Mar-14."