The global sentiment that is receding and the conciliatory allusions of the RBNZ to the OCR yesterday, will weigh on the NZD during the week to come, according to the economists of Westpac.
NZD / USD is testing the lower limit of a two month old chain. In the event of a breach, a multi-year target of 0.5800 would be reported. “
The RBNZ MPS was negative for NZD. The opening of the RBNZ to a negative OCR if necessary in the future has led the markets to foresee a 50% chance of this happening by the middle of 2021. ”
Today’s budget has revealed that the Treasury expects the Crown’s net debt to reach 54% of GDP by 2023 – slightly higher than the 50% we expected. The reaction of the NZD to the announcement was negligible, but on the contrary, it was slightly favorable. “
“We remain bearish on the NZD for the next week.”