Quotes from Westpac Institutional Bank:
-The rally since 3 Feb slowed last week but probably has further to run. We target the 0.7600-0.7720 area. The US dollar has stalled, allowing NZ factors to dominate. These have been NZD-supportive, and include the recent sharp rebound in whole milk powder prices (it has retraced 35% of the total loss from the record high in 2013).
-The NZ economic data pulse (a short term proxy for economic momentum) has risen since November. In addition, futures speculators are currently very short the NZD.
-The main risk to NZD/USD this week will be the Federal Reserve Chair's semi-annual testimony on monetray policy (Tue). Any signal implying a mid-year hike will boost the US dollar and thus hurt NZD/USD. From NZ, only a large surprise from the RBNZ's inflation expectations survey (Tue) will move the NZD.
