RBNZ: More depreciation in the offering for the NZD – ANZ

By FXStreet FXStreet (Delhi) – Research Team at ANZ, note that the RBNZ has clearly signalled that more depreciation for the NZD can be witnessed in the near term on top of its recent slide where it fell by over 5% in August.

Key Quotes

“The Reserve Bank cut the Official Cash Rate by a further 25bps to 2.75% and the underlying tone remained dovish. An easing bias was clear and downside risks discussed.”

“Further NZD depreciation is believed to be appropriate. That said, we don’t get the impression the RBNZ is necessarily in a hurry to cut again.”

“As such, we are not convinced the RBNZ is set to pull the trigger straight away in October but certainly the OCR has not yet troughed.”

“We think the NZD will now return to being driven by the global environment and the Fed. This environment holds downside risks for NZD and we maintain a strategic bias to expecting further declines, and a view that rallies in NZD are opportunities for selling.”
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Source:: FX Street