NZD/USD: Scope to run to at least 0.7050 levels - Westpac

NZD/USD has been lifted recently by a number of events: USD slippage, NZ economic data, and RBNZ governor announcement and has scope to run to at least 0.7050 this week, according to Imre Speizer, Research Analyst at Westpac. 

Key Quotes

“Additional support comes from its undervalued state (around 5%) plus extreme short speculative positioning.”

“Medium-term, though, our view remains negative, resting largely on NZ-US interest rate spread shrinkage persisting into next year. If that proves correct, we should see NZD/USD below 0.67 multimonth.”