Updates to AUD and NZD outlooks (Westpac)

Author: Eamonn Sheridan | Category: News

Doing a catch up on Westpac updating their outlooks for the two currencies over one to three month horizons: 


FOMC's dovish turn helped drive AUD to near 0.7300 

RBA's subsequent switch to neutral produced multi-week lows around 0.7050

Australia's key export prices have bounced

  • notably 2 year highs for iron ore

With pricing for RBA easing aggressive and the wary Fed outlook supporting global risk appetite, AUD/USD should continue to find support on dips towards 0.70, capped at 0.73 and ending Q1 around 0.71. 

We assume some version of a deal from US-China trade talks.



Key to the month-ahead outlook will be the RBNZ MPS

A dovish shift in stance, along the lines of that seen in the US and Australia, would renew downward pressure on NZD/USD and target 0.6600. 

Beyond the next month, if the Fed signals it will hike again this year then the USD should appreciate and NZD/USD will decline further.  


(Note - RBNZ Monetary Policy Statement is due tomoorw)
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