What is the forecast for AUD and NZD over the coming months?
Here is their view, courtesy of eFXdata:
Societe Generale Research maintains a constructive bias on AUD and NZD over the coming months.
“Last year’s catch-up in high-beta currencies was very impressive. Before vaccines triggered a wave of optimism, the currencies exposed most to Asia started benefiting from an earlier recovery there than in the rest of the world. We still expect the AUD and NZD to perform, but likely at a slower pace than last year,” SocGen notes.
“Importantly, higher US yields are unlikely to materially derail this positive outlook. When the Fed starts hinting that it will gradually exit from the current extremely accommodative conditions, the communication should be designed in a way that avoids scaring markets. On a relative value basis, AUD/NZD should head south. The cross does not yet reflect the RBNZ repricing that pushed NZD rates above AUD rates,” SocGen adds.
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