NZD/JPY: Recent correction to target the 80.70 area - Westpac

NZD/JPY peaked at 83.91 in July, and the recent correction is expected to target the 80.70 area next, suggests Imre Speizer, Research Analyst at Westpac.

Key Quotes

“Positioning ahead of the RBNZ MPS is one factor, as well as high frequency economic data suggesting the Japanese economy is strengthening in Q3.”

“It’s a quiet event week ahead with data limited to balance of payments data plus the economy watchers survey on Tuesday, followed by machinery orders on Thursday.”

“3 months ahead: The BOJ’s defacto tapering of its asset purchases should be yen supportive. In addition, the Japanese economy is seeing a pickup in consumer activity, mitigating any slippage in external demand. The 84 area should cap this cross during the quarter ahead.”