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

According to Imre Speizer, Research Analyst at Westpac, NZD/USD has been locked inside a 0.6975-0.7090 range since mid-March and given the absence of any major NZ event risk during the week ahead, they adopt a neutral bias, while acknowledging the potential for a stronger US dollar.

Key Quotes

“A sharp USD rally could easily take NZD/USD down to around 0.6900. The data calendar this week is again light with only the QV house price report for March of much interest to markets. More attention will be on the GDT dairy auction on Tue, futures pricing currently indicating a nil change (probably reflecting little change to auction volume).”

“3 months ahead: Against a backdrop of large oscillations in NZD/USD during the past six months, we err on the side of negativity for the next few months. Our main rationale remains our expectation the US dollar will resume its trend higher amid a tighter Fed and stronger US economy. We target 0.6900.”