NZD/USD: Positive bias for the week ahead - Westpac

Imre Speizer, Research Analyst at Westpac adopts a positive bias for NZD/USD for the week ahead, targeting the 0.70- 0.71 area.

Key Quotes

“The weakening US dollar should be the main factor, but stronger dairy prices and a solid budget will help.”

“Multi-month, though, we stick with our bearish outlook, targeting 0.68 by year end. Higher US interest rates and a stronger broad US dollar should be the dominant influence on NZD/USD.”

“The NZ data calendar next week is low key, with only April trade to watch on Wednesday.”

“However the annual NZ budget on Thursday will be watched by the market. We expect a strong fiscal position and outlook to be presented, notably a higher and rising operating surplus, plus a low and declining net debt position. There will be a positive fiscal impulse in the form of tax relief and infrastructure spending, but much of that money has already been set aside. If there’s any reaction from FX markets (usually there’s not), it is likely to be positive.”