NZ Dollar, Canadian & Aus Dollars: Exchange Rate Gains are Forecast

October 31, 2014 - Written by John Cameron

STORY LINK NZ Dollar, Canadian & Aus Dollars: Exchange Rate Gains are Forecast

Currency News UK presents our latest AUD, NZD and CAD exchange rate forecasts: Jawboning the local tender lower has for some time been considered a central plank of monetary policy for the world’s leading reserve banks.

Bank of Canada Governor Stephen Poloz is certainly of that opinion, if his comments of yesterday are anything to go by.

The Head Honcho at the Bank of Canada described the recent weakening of the Canadian Dollar (currency:CAD) as the ‘icing on the cake’ for his nation’s exporters.

David Tulk of Toronto-Dominion Bank explained that, ‘the prospect of continued momentum in the U.S. economy provides the cake in Poloz’s metaphor and a weaker Canadian dollar helps to offset the hit to weaker energy prices.’

He went on to assert that the softer Loonie, ‘provides more competitiveness to a wider range of Canadian exports.’

The medium-term outlook for the Canadian unit is informed by the expected improvement in domestic industry and an inevitable upward move in global oil prices. The CAD is forecast to trade on neutral to positive footing during this timeframe.

RBNZ Continues Policy Pause

Elsewhere, the past 24hrs have also brought pointed comments from the Governor of the Reserve Bank of New Zealand (RBNZ).

The Kiwi central bank announced earlier this year that it was pushing the ‘pause’ button on its interest rate hiking cycle and this week’s policy announcement confirmed that the hiatus would be continuing for a considerable time.

Graeme Wheeler of the RBNZ observed that, ‘a period of assessment remains appropriate before considering further policy adjustment.’

Wheeler went on to once again bemoan the unjustifiably high level of the New Zealand unit.

These comments, in combination with the recent revelation that the RBNZ had dumped NZD-denominated assets onto the market during August in an effort to actively weaken the local tender, mean that the selling pressure remains on the Kiwi Dollar.

Aussie Fortunes Depend On Commodity Prices

Meanwhile, the Kiwi’s sister currency has been faring a little better in the markets.

The Australian Dollar (currency:AUD) has gradually improved against the Pound Sterling during the past month, sending the GBP AUD exchange rate down to an intraday low of 1.8112 yesterday.

Any renewed uptick in global commodity prices could readily send the GBP AUD exchange rate back down into the 1.7000s once again.

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TAGS: Australian Dollar Forecasts Canadian Dollar Forecasts Currency Predi Forecasts