We have tweaked our NZD/USD forecasts, revising our 1-and-3-month forecasts to 0.6100 and 0.6200 respectively from 0.6000.

While the NZD would likely sell-off on a steady policy announcement next week, downside potential for the Kiwi should be limited by the perception that the RBNZ policy will be slow to remove policy restrictions.

On the view that the RBNZ will lag the Fed’s first rate cut announcement, we see scope for NZD/USD to push higher to 0.6500 on a 12-month view.