Economists at Westpac are bearish for the week ahead on the kiwi, expecting the 0.6925 low formed on 18 June to be tested. US payrolls are the main risk event near-term, as reported by Westpac.
The next major events will be the RBNZ meeting (14 July), and Q2 CPI (16 July)
“We are bearish for the week ahead, expecting the 0.6925 low formed on 18 June to be tested. A break would then signal 0.6800, where we would be looking for buying opportunities.”
“The main risk near term will be the US payrolls report on Friday, a strong outturn USD supportive.”
“Later this month, the RBNZ should reiterate its new hawkish stance. And CPI inflation data should jump sharply (surveyed pricing intentions have surged).
“Longer term, we remain NZD/USD bullish, targeting 0.74 by year-end.”
“Domestic fundamentals remain supportive, with NZ-US yield spreads rising due to the RBNZ’s more hawkish outlook (vs the Fed), and NZ commodity prices expected to remain elevated over the rest of this year. And global risk sentiment should remain elevated as economies recover.”
