NZD tumbling over 1c in response to RBNZ - Westpac

The research team at Westpac explains that the RBNZ today kept the current OCR and MPS projection to mid-2020 unchanged. Markets had clearly been positioned for a hawkish shift, NZD tumbling over 1c in response.

Key Quotes

 “While this will set the tone for kiwi trade in the days ahead, the main fall should be behind us now. RBNZ asst. gov. McDermott’s comments that “there is an even chance of a hike or a cut in the future” should weigh, but NZD/USD shouldn’t trade below 0.6725/50.”

“Multi-month, we stick with our bearish outlook, targeting 0.67. Higher US interest rates and a stronger USD should be a dominant influence on NZD/USD.”