​NZD/USD Is Expected to Increase to 0.67

WikiFX News (7 Oct.) - Westpac expected recently that NZD/USD will rise to 0.67 within a few months. New Zealands economy shrunk by 4% year-on-year, estimated previously to shrink 6%; the peak unemployment rate was expected to fall from 9.5% to 8%, and the unemployment rate may peak in 2021.

Furthermore, the Reserve Bank of New Zealand is set to expand its Large Scale Assets Purchases gradually to US$ 100 billion, and will lower the Official Cash Rate to -0.5%. Thus, it is expected that NZD/USD will increase to 0.67 at the end of this year.

An analyst at Citigroup said that NZD will be bearish continuously before voting in New Zealand General Election on October 17th because of more easing policy by the Federal Reserve of New Zealand. While, Westpac argued that NZD/USD would keep a slight drop and may decline sharply after breaking below the level of 0.6500. Stimulated by global central banks and governments, the risk appetite is expected to stay strong throughout the rest of this year.

New Zealands economy may outperform the US. Although the decreased yields and interest spreads will offset these optimistic effects, generally NZD/USD is likely to reach the level of 0.67.

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Chart: NZD/USD Trend