The NZD/USD pair is set to controlled by the risks coming from the Chinese economy, according to analysts at ANZ Research. The pair is trading at 0.6414, rising 0.20% today.
Key quotes
“Disruption in the Chinese economy is already impacting New Zealand’s exports, and this will likely cause a sharp near-term dent to GDP growth. If the virus is contained quickly, then a vigorous bounce back inactivity is expected. But a larger impact cannot be ruled out.”
“We expect the RBNZ to keep the OCR on hold, but that they will highlight significant downside risks to the outlook – signalling that they will respond with more monetary stimulus if required.”
“NZS/USD expected to be dominated by risk sentiment as NZD trades as a proxy for China risk. Markets will primarily be looking to gauge the RBNZ’s responsiveness to emerging global risks.”
“Support 0.6360 Resistance 0.6490”
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