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NZD/USD may target 0.73 this week - Westpac

Imre Speizer, Senior Market Strategist at Westpac, suggests that the NZD/USD post-Brexit reaction was sharp but short-lived, and gave way to a rebound to 0.7200.Key Quotes“Global markets have calmed down and that should help push NZD/USD above 0.7200 this week, targeting the June high of 0.7300. NZ’s data calendar is quiet this week, only the housing market reports from REINZ (Fri) and QV (Tue) of interest. The GDT dairy auction will be watched by NZD traders though. Our futures based model currently implies a 3% rise in whole milk powder prices. The USD, if anything, is vulnerable this week to a payrolls report which could disappoint. June’s jobs gain is expected to be 180k after May’s paltry 38k. The Fed minutes are out too, during a 4th July holiday shortened week.3 months: We target 0.66, based on a stronger US dollar and the RBNZ cutting to 2.0%. Even if the Fed doesn’t tighten this year, Brexit contagion and more general global risks should support the US dollar for safe-haven reasons.1 year: Our economic fundamentals based forecast is 0.63.”Imre Speizer, Senior Market Strategist at Westpac, suggests that the NZD/USD post-Brexit reaction was sharp but short-lived, and gave way to a rebound to 0.7200.Key Quotes“Global markets have calmed down and that should help push NZD/USD above 0.7200 this week, targeting the June high of 0.7300. NZ’s data calendar is quiet this week, only the housing market reports from REINZ (Fri) and QV (Tue) of interest. The GDT dairy auction will be watched by NZD traders though. Our futures based model currently implies a 3% rise in whole milk powder prices. The USD, if anything, is vulnerable this week to a payrolls report which could disappoint. June’s jobs gain is expected to be 180k after May’s paltry 38k. The Fed minutes are out too, during a 4th July holiday shortened week.3 months: We target 0.66, based on a stronger US dollar and the RBNZ cutting to 2.0%. Even if the Fed doesn’t tighten this year, Brexit contagion and more general global risks should support the US dollar for safe-haven reasons.1 year: Our economic fundamentals based forecast is 0.63.”



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