According to analysts at ANZ, with correlations breaking down both between and within markets, picking near-term currency market direction from here is difficult.
Key Quotes
“It is likely to hinge on how that bond and equity market stand-off prevails, and that may not be answered this week. We’d not be at all surprised to see quite choppy price action. By and large we still feel that the stronger USD theme has a bit further to run, especially against risk currencies, and that leaves us happy with a view that the NZD is still a sell on rallies. And while domestic factors are certainly taking a back-seat here, that is how we’d play any NZD strength on the back of a strong CPI release.”
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