The NZD has been the outperformer of 2014. Fundamentalssuggest that should continue.Our economic data pulse mode (Chart 2), which captureseconomic momentum, is riding high. Accordingly, the RBNZ isexpected to start hiking in March, the first OECD central bankto do so this year. Indeed, recent strong data (such as GDP) hassurprised the RBNZ such that it should raise the OCR by 125bpin 2014.With the US dollar stung by a weak payrolls report, the near termenvironment is positive for NZD/USD. We expect a break aboveresistance at 0.8300 to reach 0.8400 during the next week ortwo.Looking further ahead, by mid-2014 NZ’s strong fundamentalsshould be even more evident, taking NZD/USD towards 0.8600.
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