No change since last month: The NZDUSD top is also in place (notice divergence and the monthly close below the long term support line). For now, the minimum target is below .5927.
New Zealand's interest rate outlook is quite similar to that of Australia, and the New Zealand dollar stands to lose a substantial portion of its interest rate advantage against the US dollar and other forex counterparts. Indeed, the NZD-USD yield differential is predicted to shrink by 1.60 percentage points in the coming year-that which would leave the highly yield-sensitive NZD at a clear disadvantage through the medium/long term. Outlook for the New Zealand dollar remains bearish from an interest rate perspective.
New Zealand Dollar Forecast to Recover on Forex Sentiment Extreme
Written by Jamie Saettele, Senior Strategist and David Rodríguez, Quantitative Analyst for DailyFX.com
To contact the authors of this report, please e-mail research@dailyfx.com.