NZD/USD: Corrective rebound expected - Westpac

NZD/USD made a three-year low at 0.6780 last week, the ensuing bounce looking likely to extend to at least 0.6980 (the early Nov high), according to Imre Speizer, Research Analyst at Westpac.

Key Quotes

“NZD/USD is undervalued, and speculators are very short NZD. The NZ data calendar during the week ahead contains ANZ business confidence, terms of trade, QV house prices and GDP partials (construction, manufacturing). The next GDt dairy auction is on 5 Dec.”

“Three months ahead: Our medium term outlook for NZD/USD remains largely dependent on the outlook for the US dollar. A persistent rebound in the US dollar should drag NZD/USD lower to the 0.67 area during the next few months.”