NZD/USD: fade rallies’ 0.6250 is fair value – BNP

By FXStreet FXStreet (Guatemala) – Analysts at BNP Paribas noted that in New Zealand, the main takeaway from RBNZ’s latest financial stability report is the increased concerns over loans to dairy farms and elevated house price-to-income ratios.

Key Quotes:

“Concerns about housing could be seen as standing in the way of further rate cuts and NZD has strengthened accordingly. We suspect however that the RBNZ would lean further on macro prudential measures to address housing issues while easing its rates stance as well (markets are pricing a full rate cut by March). We are biased to fade rallies in NZD/USD with our STEERTM model signalling short term fair value at 0.6250.”
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Source:: FX Street