Westpac again, this time with a comment on the NZD

Quick take from WPACNZ's Imre Speizer (summary and bolding mine)

  • The policy guidance paragraph was: "Headline inflation is expected to move higher over 2016, but take longer to reach the target range. Monetary policy will continue to be accommodative. Further policy easing may be required to ensure that future average inflation settles near the middle of the target range. We will continue to watch closely the emerging flow of economic data.".

Specifically on the currency:

  • The NZD exchange rate narrative was a fairly weak warning, as it was in January, now reading: "The trade-weighted exchange rate is more than 4 percent higher than projected in December, and a decline would be appropriate given the weakness in export prices.".
  • NZD/USD ... should extend towards 0.6600 over the day .
  • AUD/NZD ... should remain bid during the weeks ahead, en-route to the next major target at 1.1350