In August AUD/NZD spent time above 1.10 for the first time since 2018, but the pair has since struggled. Economists at Westpac expect AUD/NZD to extend the fall towards the 1.05 mark in the short-term, however, the pair could rally to 1.12 in 2021.
Key quotes
“Our base case of a risk-friendly ‘Blue Wave’ US election should help AUD/NZD track higher into year-end. Relative commodity prices are also supportive, helping Australia print ongoing trade surpluses.”
“The Aussie has lost some shine on the RBA outlook, with markets braced for not just rate cuts but substantial QE at the Nov meeting. However, the RBNZ continues to prepare for a negative cash rate in 2021, and Westpac expects a cheap bank funding scheme to be announced at the November meeting.”
“Near term, AUD/NZD losses could extend to the 1.05 handle. But into year-end, renewed focus on RBNZ easing in 2021 and a positive global risk mood should help reduce AUD/NZD undervaluation versus fair value, rallying to 1.12.”
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD: Extra upside now looks at 0.6550
AUD/USD managed to leave behind Tuesday’s strong decline and printed a decent recovery on Tuesday, retesting the 0.6500 zone amid the broad-based retracement in the US Dollar.
EUR/USD need to clear 1.0600 to allow for further advances
The strong sell off in the Greenback encouraged EUR/USD to set aside the previous day’s pullback and refocus on a potential visit to the key barrier at 1.0600 the figure ahead of key data releases in the euro area later in the week.
Gold eases from daily highs as bears seize control
Gold remains on the positive foot near $2,640 per troy ounce, as US inflation data matched initial estimates in October, while US yields display a negative performance across the curve.
Ethereum Price Forecast: ETH surges 9% with increased capital inflows, bulls set sights on $4,522
Ethereum (ETH) rallied 9% on Wednesday following increased capital inflows into ETH ETFs and a major uptick in its open interest and futures premium. If the bullish momentum sustains, ETH could overcome its yearly high resistance of $4,093 and rally to $4,522.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.