Near term momentum is negative and we expect a test of 0.7660 major support. This week’s RBNZ meeting – a full-blown MPS – should present downgraded inflation and interest rate forecasts and repeat the warning that the NZD remains too high. The market’s response is
likley to be to sell the NZD on the day. The US dollar will likely see at most a minor fl esh wound if US retail sales underwhelm next week (cold weather effects), the focus instead likely to shift to the17 Dec FOMC meeting where expectations for more clarity around rate lift-off in the wake of strong jobs data should create a fertile backdrop for the USD to keep plodding higher.
Read the full report: Market Research