Nzd.usd

[peat]

well... on the long kiwi thing.... so far so good..... quite a whip up on Fri nite huh!

note that Gold Coast Martin wrote a very long diatribe on the global-view forex forum over the weekend, which has relevance. Hes still adamant the Kiwi is a sell , but then he said the USD/CAD was a long at 1.1900 as well.

[Dubdee]

The solution in my opinion is to opt out of the agreement that residential mortgage lending requires banks to put up only 50% of the capital required to lend to any corporate. This would immediately raise the cost of lending to retail without effecting corporate Sector, but aparently we have some agreeement with other central banks to abide by the Basle rules which govern such things.

[Xerof]

Dubdee, you're quite right, on all counts, but there is the issue of securitisation of mortgage books to counter as well, which takes residential mortgages off banks books anyway

[Xerof]

[peat]

wot u mean by that ?
Dove?

[Xerof]

yep, although some might see it as still hawkish

probably 'more balanced' is a better description, but there's no bird to represent that

only went .25, removed overt comments regarding more hikes to come, and whilst still concerned about demand side inflation risks, the statement has a more balanced look about it by talking about downside risks to their forecasts. The forecasts themselves imply no more hikes

Xerof

[zyreon]

i read his "Whether further tightening is needed will depend on the extent to which housing and demand pressures show signs of moderating over the months ahead." to possibly mean we'll sit on our hands for a while now.

[Xerof]

quote:RBNZ puts the death knell on the Kiwi, we think we have seen the last rate hike in their cycle now.
Craig Ferguson, Senior Currency Strategist ANZ

Well, we wrote in last night’s report that the fate of the Kiwi lay in the RBNZ’s hands. Our motto is “never bet against the RBA”, and in this sense, we can extend that concept to the NZ context, and now state that we also “should never bet against the RBNZ”. One reason for this is that they own the monetary policy stick, and can often use it to follow up any public comments they make. We didn’t really consider last night the outcome for the NZD if the RBNZ hiked and then were dovish, as we really didn’t think they were overly concerned as yet that NZ GDP growth was decelerating fast enough to offset inflationary pressures. However you can see what the market’s reaction to that dovishness means for the NZD in the price action this morning.

The feature of their statement accompanying their policy hike this morning was the more dovish tone, the balance now between domestic growth and inflation risks as dictators of future rate hikes, and the rising risks of a possible hard landing. No reference was made, as in the last statement, that further rate hikes would be likely, and while the RBNZ said that at this stage no easing prospect is foreseeable, we believe that NZ rates will be around 5.5% in 2007 as the easing cycle, when it comes, will be extremely aggressive.

The implications are pretty clear for the currency. The RBNZ have used the policy stick to provide the death knell for the NZDUSD and NZDAUD rates. Thankfully we suggested last night that shorts should be entered in NZD around .71 cents. We believe those shorts should be kept and added to, as the next stop for NZDUSD is .6650 and then much lower levels.

At least somebody agrees with me

Xerof

[Xerof]

quote:7/12 - where's the door............

Looks like a few have decided to use this instead.....

Xerof

[Xerof]

First look at NZD for the year - up the stairs again....

Multiple Ganns and 61.8% fib looming at around 70 cents, and in EW terms, perhaps in wave 4, but leave that to the experts......



Xerof