NZD/USD has had a good run in September, rising 2c and at 0.73, it remains below fair value of 0.75, and is likely to remain so during the weeks ahead partly because following the NZ general election on Sat 23 Sep wherein no party recorded a majority, according to the research team at Westpac.
“Coalition negotiations during the next two weeks mean a period of uncertainty, which translates into negative pressure on the NZD.”
“The typical pattern over the past 10 elections is shown below: a decline in the lead up to the election, and then a period of ranging followed by a rally.”
“Further out, we remain with our year-end forecast of 0.70, based on the Fed hiking in Dec, and again twice next year.”
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