NZD/USD seen sidelined in the near term – UOB

FX Strategists at UOB Group now expect the Kiwi Dollar to move into a consolidation phase in the near term.

Key Quotes

24-hour view: “In line with expectation, NZD traded sideways last Friday, albeit at a narrower range than anticipated. The movement is viewed as a consolidation phase and NZD is likely to continue to trade sideways for today, expected to be between 0.6270 and 0.6310”.

Next 1-3 weeks: “We highlighted (26 Sep, spot at 0.6275) that a “NY closing below 0.6255 would suggest further NZD weakness to 0.6200”. We added, “the prospect for such a scenario is not that high but it would continue to increase unless NZD can move above 0.6320”. NZD subsequently bounced to an overnight high of 0.6327 before ending the day on a firm note at 0.6295. The downside risk appears to have waned and from here, NZD is more likely to consolidate and trade sideways, expected to be within a 0.6255/0.6365 range”.