AUD/NZD could drop to 1.05 before rising back to 1.10 – TD Securities

According to Mazen Issa, Senior FX Strategist at TD Securities, relative data surprise momentum has begun to move in favor of the Kiwi (NZD) and suggests that AUD/NZD has some room to slide. They think “a move towards 1.05 would be a good reassessment point to fade.”

Key Quotes: 

“The Antipodean currencies have languished over the last two years. Easier central bank policy has effectively removed the last vestiges of hope for AUD & NZD, as these currencies succumb to the USD carry king.”

“Absent an appreciable and sustained positive global macro impulse, these currencies will continue to languish in FX purgatory. We see clear risks that they continue to grind towards new cycle lows. While there is room for fiscal maneuvering, hedging costs and loss of yield advantage to the USD will likely continue to starve these currencies - NZD especially - of foreign capital flows.”

“Our expectation for these currencies to flat line over the next 6m could be too optimistic. Tactically, we see room for AUDNZD to temporarily dip before returning towards 1.10 by year-end.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Forex News

Editors’ Picks

EUR/USD pressured around 1.13 after jump in US jobs

EUR/USD is trading around 1.13, down after US Non-Farm Payrolls shocked with a leap of 2.5 million jobs in May, contrary to all projections. The greenback is gaining while stocks are falling, a correlation breakdown. ECB stimulus previously supported the euro.


GBP/USD retreats from highs

GBP/USD is trading below 1.27, off the highs. The pound is struggling after Chief EU Negotiator Barnier reported little progress in Brexit talks. Robust US jobs support the dollar.


Gold sees weekly closing below $1700 - a caution for bulls

The steady decline in Gold prices (futures on Comex) accelerated on Friday, as the rates closed the week below the 1700 mark for the first time in three weeks at 1688.35. A weekly closing below the key 1700 level is unlikely to bode well for the bulls.

Gold News

Institutional demand exceeds Bitcoins supply

Greyscale floods the market with fresh money to satisfy the demand of its clients. Investors, willing to pay a 29% surcharge for exposure to Bitcoin without suffering the legal and operational inconveniences. Market remains at risk on the verge of new bullish territory.

Read more

WTI rallies above $39 as focus shifts to OPEC+ meeting

Crude oil prices built on Thursday's modest gains and rose sharply on Friday boosted by the upbeat market mood optimism surrounding Saturday's OPEC+ meeting. 

Oil News