NZD/USD Outlook: Up this week
This month’s hawkish surprise from the RBNZ should keep the market in a bullish mood towards the NZD, despite the modest downside surprise from the Q1 GDP report (although net of revisions it matched consensus). The RBNZ is likely to hike again in July.
Further, last week’s FOMC-induced decline in US interest rates underscores the attractiveness of the NZD from a global carry perspective. The next target above is 0.8780, and beyond that, 0.8840 – the record high.
While noting NZ economic momentum has slowed lately (Chart 2), the momentum of US economic data surprises also reversed (Chart 3). Of the two, the latter is the dominant factor
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