Forex Flash: NZD/USD still a buy – BNZ
FXstreet.com (Barcelona) - Globally, US data (payrolls and ISM manufacturing) will hog the limelight this week, although tomorrow's Bank of Japan meeting will also be worth watching. "We suspect the risks around the meeting are for a stronger JPY (lower USDJPY and NZDJPY)." writes the BNZ Research Team.
"Elsewhere, an increase (in the official Chinese manufacturing PMI (Thursday)( will be important to sustain investors' risk appetite, (and Eurozone finance ministers look set to make a( call on the next tranche of Greek financial aid at some stage - currency markets will only react if there are(any unexpected hitches." the team suggests.
"All up, rising NZ-US yield differentials, coupled with the recent brightening in the global backdrop (US housing data looking better, Europe stable, China turning), supports our view the NZDUSD is still a 'buy on dips' currency. Near-term NZDUSD pullbacks should be limited to the 0.8080/0.8100 region in the short-term. A break above the 0.8245 top end of the range would pave the way for a return to September's 0.8350 highs." they add.
"Elsewhere, an increase (in the official Chinese manufacturing PMI (Thursday)( will be important to sustain investors' risk appetite, (and Eurozone finance ministers look set to make a( call on the next tranche of Greek financial aid at some stage - currency markets will only react if there are(any unexpected hitches." the team suggests.
"All up, rising NZ-US yield differentials, coupled with the recent brightening in the global backdrop (US housing data looking better, Europe stable, China turning), supports our view the NZDUSD is still a 'buy on dips' currency. Near-term NZDUSD pullbacks should be limited to the 0.8080/0.8100 region in the short-term. A break above the 0.8245 top end of the range would pave the way for a return to September's 0.8350 highs." they add.
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