NZD/USD broke below a two-week-old contracting range. The kiwi now targets 0.62, economists at Westpac report.

Potential for the NZD to rebound towards 0.68 by end-2022

“Potential for further weakness during the month ahead, 0.62 likely to be tested. If that broke, we’d then target the 0.60 area, which was an area of much congestion in early 2020.” 

“The main drivers of NZD/USD at present are global risk sentiment (proxied by equity prices, for example) and the US dollar (in turn driven by both risk sentiment and yield spreads).”

“During the month ahead, the direction of risk sentiment will be key. But much further ahead, by year-end, assuming sentiment stabilises, there is potential for the NZD to rebound towards 0.68.”

See – NZD/USD: Move lower looks ominous from a technical perspective – ANZ