Strength expected for NZD/USD pair

SINCE March this year, the NZD/USD pair has seen a powerful advance. With New Zealand having been declared virus-free on June 8, the New Zealand dollar is expected to gain further strength.

As global economies start reopening, there has been generally an increase in risk appetite in markets. This has resulted in commodities-related currencies, such as the NZD, gaining interest, and safe havens, such as the USD, losing its shine.

The prospects of the NZD now are a far cry from where it was one month back, when there were still worries that the Reserve Bank of New Zealand (RBNZ) could slash rates further as it indicated the possibility of negative interest rates going forth. Currently, the strength of the NZD is more apparent amid improving fundamentals, coupled with technical indicators pointing towards brighter prospects.