Some in brief comments from Westpac on the New Zealand dollar

FOMC and NZ GDP data just 5 hours apart

  • US dollar a main driver of NZ/US exchange rate recently, risk is for a USD decline if the FOMC 'encourages market doves'
  • Add in that the NZ GDP 'should show a continuation of NZ's economic slowdown … but also not be as weak as the RBNZ has forecast' - might see pricing for a rate cut in August fall

Further out, outlook is for lower NZD:

  • NZD/USD's main negative factor will continue to be US trade tensions which have broadened beyond China.
  • Multi-month, we expect the story of US growth outperformance to persist, lifting the US dollar further, and in turn, pushing NZD/USD towards 0.6400 over the next quarter