24 Jul 2014
NZD at risk of intervention any day - Westpac
FXStreet (Bali) - After today's strong rhetoric towards the NZD by the RBNZ, Westpac thinks that the Central Bamk could intervene in foreign exchange markets by selling New Zealand dollars any day now.
Key Quotes
"A risk of currency intervention Today’s press release strengthened our conviction that the RBNZ could intervene in foreign exchange markets by selling New Zealand dollars any day now."
"The RBNZ riled against the inconsistency between tumbling export commodity prices and the very high exchange rate by saying “the level of the New Zealand dollar is unjustified and unsustainable and there is potential for a significant fall.”
"We interpret this choice of language as a direct warning of intervention. The reaction on foreign exchange markets was vigorous."
"The NZD/USD exchange rate fell from 87c to 86c, and could fall further. This reaction struck us as entirely sensible – indeed, we are forecasting the NZD/USD to average 83 cents over the remainder of 2014."
Key Quotes
"A risk of currency intervention Today’s press release strengthened our conviction that the RBNZ could intervene in foreign exchange markets by selling New Zealand dollars any day now."
"The RBNZ riled against the inconsistency between tumbling export commodity prices and the very high exchange rate by saying “the level of the New Zealand dollar is unjustified and unsustainable and there is potential for a significant fall.”
"We interpret this choice of language as a direct warning of intervention. The reaction on foreign exchange markets was vigorous."
"The NZD/USD exchange rate fell from 87c to 86c, and could fall further. This reaction struck us as entirely sensible – indeed, we are forecasting the NZD/USD to average 83 cents over the remainder of 2014."