Bank of America Merrill Lynch Research expects the Reserve Bank of New Zealand (RBNZ) to stay on hold on Thursday.
"No change is expected to policy. But in our view there is a more convincing case for the RBNZ to consider shifting the policy bias toward the normalization of record low interest rates ahead of Australia. There is stronger economic momentum in New Zealand, a better fiscal position that will allow greater pro-cyclical infrastructure spending, improving terms of trade and notably better consumer sentiment than Australia," BofAML argues.
Trade-wise, BofAML recommends long NZD/JPY in the medium-term and is also comfortable selling AUD/NZD on rallies given the likely medium-term divergence in economic paths.
Trader Senan Fuchedzhiev
Read more:
25 Canada Square, Level 33, office 50, Canary Wharf London, E14 5LQ +44 20 3608 6256
World Financial Markets - 0700 17 600 Varchev Exchange - 0700 115 44
Varchev Finance Ltd is registered in the FCA (FINANCIAL CONDUCT AUTHORITY) with a passport in the United Kingdom: FCA, United Kingdom - registration number: 494 045, which allows provision of financial services in the United Kingdom.
Varchev Finance Ltd strictly comply with the statutes of the European directive MiFID (Markets in Financial Instruments). targeting increased efficiency, transparency and uniformity of financial instruments.
Varchev Finance Ltd is authorized and regulated by the Financial Supervision Commission - Sofia, Bulgaria: License number RG-03-02-05 / 15.03.2006
The information on this site is not intended for distribution or use by any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Disclaimer:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 63,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.