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29 Apr 2013
Forex Flash: AUD/NZD to keep falling into a lower 1.15-1.20 range - UBS
FXstreet.com (Barcelona) - The AUDNZD hit a new three year low last week below 1.21. According to UBS, "we expect the exchange rate to keep declining into a lower 1.15-1.20 range this year."
First, the Reserve Bank of Australia continues to have an easing bias, says UBS, while in contrast, "the Reserve Bank of New Zealand kept interest rates unchanged at 2.50% at this month's meeting, but it bucked the global trend by signalling the risks were on the upside now by dropping the phrase 'there are both upside and downside risks to this outlook' from its statement."
Continuing on the RBNZ stance, UBS suggests "this suggests the next move in rates eventually will be up. As a result we think the outlook for AUDNZD remains bearish."
First, the Reserve Bank of Australia continues to have an easing bias, says UBS, while in contrast, "the Reserve Bank of New Zealand kept interest rates unchanged at 2.50% at this month's meeting, but it bucked the global trend by signalling the risks were on the upside now by dropping the phrase 'there are both upside and downside risks to this outlook' from its statement."
Continuing on the RBNZ stance, UBS suggests "this suggests the next move in rates eventually will be up. As a result we think the outlook for AUDNZD remains bearish."