This will be my last BNZ Markets Wrap & Strategy. Thanks for your interest and readership and over the past few years. All the best, Mike. In relatively sleepy trade, the NZD saw out last week the same way it began – on the back foot. The NZD/USD slipped to a fresh two month low below 0.8090, before clawing its way back to a 0.8135 close. The kiwi’s underperformance last week was somewhat surprising given the clear strengthening in the fundamentals. Local data remained almost unbelievably upbeat, and NZ-US 3-year swap differentials widened out to the highest level since November 2010 as OIS markets flirted with a January RBNZ rate hike (currently 37% priced). Nevertheless, speculative selling amongst the NZD crosses (NZD/GBP in particular) won the day and dragged the NZD/USD lower.
Read the full report: FX Daily
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