- NZD/USD starts off Asia better offered, with a focus on the greenback.
- The RBNZ will be the main event for the Kiwi this week.
NZD/USD is currently trading at 0.6984, down some 0.20% on the day as traders get set for the Asian session.
NZD/USD travelled between a low of 0.6948 and a high of 0.7008 with the US dollar edged higher across the board on Monday as concerns about the pandemic encouraged investors to seek the safe-havens.
Amid a dearth of data, so far, the greenback will likely remain in favour. With regards to the kiwi specifically, all eyes in the coming days will on the Reserve Bank of New Zealand to see if it can meet the market’s expectations for hikes.
”The kiwi started the week by moving lower but then unwound a lot of this move as the day progressed. Markets were broadly calm to start the week amid a lack of data. A lot of focus is likely to be on rates markets again this week to see whether there is a further unwind of the recent rally in US Treasuries,” analysts at ANZ Bank said.
For the Kiwi, the key factor this week will be the RBNZ meeting.
”Given how far market pricing has already moved, it may be difficult for the central bank to ‘out-hawk’ the market. As such, it may be difficult for the RBNZ decision to generate a large move in the Kiwi unless there is a large shift in the language,” the analysts at ANZ Bank said.