After a year in which economics gave way to politics, 2017 has so far been equally turbulent.
Markets are still digesting the impact of President Trump, not to mention Brexit further afield. Important European elections this year are likely to send further shockwaves through markets. If the rising tide ofnationalism persists (post Trump, Brexit), there could be grave consequences for the Eurozone.
In NZ, after crossing its fingers for a lower NZD for many months, the RBNZ may finally be getting its wish. They have confirmed the outlook for NZ interest rates as lower for longer, signaling only one rate hike before March 2020.
Dairy prices are forecast to remain largely subdued, house price inflation has moderated, and the pace of net migration has slowed somewhat, leading many to believe the Kiwi may have had its day in the sun.
The fact that these drivers are set against the backdrop of rising US interest rates is likely to exacerbate their impact.
Currency values are the product of a truly dizzying number of variables. XE helps its clients filter out the noise and focus on what matters: identifying and managing risk.
Alex Hill. Head of Dealing at XE Money Transfer New Zealand
