NZD/USD to keep the foot on the pedal as Delta concerns are pushed away – ANZ

The NZD/USD pair is higher this Tuesday, courtesy mainly of USD factors and global risk appetite. But, as strategists at ANZ Bank note, markets also seem sanguine about the odds of beating Delta too, and that should keep the kiwi well supported.

Global risk markets start the week on a high note

“The recovery in equities and risk appetite, together with what the market appears to be viewing as ‘light’ at the end of the ‘lockdown tunnel’ has helped the kiwi.” 

“We would not overplay local factors given the drop in the USD DXY and similar strength seen in the AUD, but on balance the market seems to be slanting toward the view that NZ will beat Delta, and if that is the case, that should put OCR hikes and carry back on the table later in the year. That said, there are no guarantees and a lot depends on global developments.” 

“For now, the market has seen the NZD/USD pair bounce off 0.68 when all the chips were down, and that will likely be a solid base of support for now.”

“Support 0.6760/0.6800 Resistance 0.7030/0.7100/0.7170”