NZD/USD: Bullish profile for the rest of the year – ING

The New Zealand Dollar (NZD) has had a strong month of February, emerging as the best-performing G10 currency. Economists at ING analyze Kiwi’s outlook.

NZD/USD to break the 0.6500 mark the third quarter

Our view that rate cuts in New Zealand won’t start before August and that the Fed should instead start cutting during the summer translates into a bullish NZD/USD profile for the rest of the year. However, external volatility can offset the positives of a hawkish RBNZ in February and favour a near-term slide to more attractive levels for longer-term bullish positioning. 

We see NZD/USD breaking the 0.6500 mark in 3Q24.

Some downside risks related to the US elections and potentially negative implications for China-related sentiment may warrant a less optimistic NZD profile in 4Q24.