Outllook for AUD/NZD towards 1.1000 - Westpac

Analysts at Westpac explained the outlook for AUD/NZD.

Key Quotes:

"1 day: Yesterday’s breakdown will cause chatter about parity, but the 1.04 area was congestive for a long period in early 2014.

AUD/NZD 1-3 month: The RBA surprised by cutting in May, which suggests another cut to 1.5%, probably in August. The RBNZ is also expected to cut, to 2.0% in August. Relative central bank paths are thus neutral for the cross. Multi-month, though, there is a case for higher, towards 1.1000, given it is currently well below fair value implied by interest rates, commodity prices and risk sentiment.