Moody’s Economy.com is wary about the future of the New Zealand dollar.
“There is very little upside potential to the kiwi at the moment,” Stroppiana says. “All of the risks are associated to the downside. In particular, a crash in the New Zealand housing market is likely, which would be disastrous for the kiwi.”
BNP Paribas was also bearish on the outlook for the kiwi, with a year-end target of 0.6100. However, Fink admits, “The trend is toward greater appreciation in these currencies. The risk is of a sharp reversal and the timing is very uncertain.”
She advises traders to be on the lookout for “global growth fears” as that would not be beneficial to these currencies.
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