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Analysts at ANZ note that the NZD/USD has bounced as expected, and with recent data showing the market remains short, there may be more left in this tank.

Key Quotes

“However, after a period of absence, negative trade headlines have emerged again today, and, if the near-term data flow continues to undershoot expectations, then there is no reason why the NZD can’t remain under pressure even with stretched positioning.”

“We continue to believe that AUD/NZD (NZD/AUD) is a higher (lower) trading range here, and if it was just a case of domestic considerations, there’d be room for further near-term strength (weakness). But it is of course not just about domestic considerations!”