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25 Nov 2013
Flash: Case building for a 25bp RBNZ rate hike in January - ANZ
FXstreet.com (Barcelona) - ANZ Economists think that the case is building for a 25bp rate hike in New Zealand next January.
Key Quotes
"The dataflow is one way, and while the risk profile – not least around the NZD and global scene – will ensure a cautious hiking cycle, the RBNZ will not want to get behind the curve and the Governor needs to get his inflation fighting credentials cemented. Data this week is expected to remain strong, while GDP revisions will improve the look of New Zealand’s external position."
"The NZD remains caught in a tug-of-war between cyclical economic support domestically and the wider trajectory for the USD. We expect the NZD to remain strong on a trade-weighted basis due to NZ economic strength becoming more evident."
"NZD/AUD broke to a new cycle high last week and risks remain for a further test of resistance on the upside, whereas a break to the downside would require an unexpected catalyst."
Key Quotes
"The dataflow is one way, and while the risk profile – not least around the NZD and global scene – will ensure a cautious hiking cycle, the RBNZ will not want to get behind the curve and the Governor needs to get his inflation fighting credentials cemented. Data this week is expected to remain strong, while GDP revisions will improve the look of New Zealand’s external position."
"The NZD remains caught in a tug-of-war between cyclical economic support domestically and the wider trajectory for the USD. We expect the NZD to remain strong on a trade-weighted basis due to NZ economic strength becoming more evident."
"NZD/AUD broke to a new cycle high last week and risks remain for a further test of resistance on the upside, whereas a break to the downside would require an unexpected catalyst."