NZD/AUD finding 0.88 sticky - Westpac

NZD/AUD cross rebounded after coming close to testing the key 0.88 level again, and seems to be comfortable sitting around 0.90 for now, according to Imre Speizer, Research Analyst at Westpac.

Key Quotes

“0.90, coincidentally, is fair value according to our short term model. The event calendar this week includes home loan approvals data (9 Nov).”

“3 months ahead: We continue to target 0.88 by year end. If anything, risks are to the downside. Supportive of the AUD is positive Chinese economic data (although we expect that to change in 2018), while the RBNZ’s on-hold stance (arguably even more entrenched than the RBA’s) is chipping away at NZ’s yield advantage.”