Rabobank economists have adjusted their NZD/USD forecast for the next 12 months, expecting the currency pair to reach 0.6500.
They anticipate that the Reserve Bank of New Zealand (RBNZ) will be slow in removing policy restrictions, leading to a gradual approach in adjusting policies.
The economists have revised their forecasts for the NZD/USD for the next 1 and 3 months to 0.6100 and 0.6200 respectively, up from the previous forecast of 0.6000.
While the New Zealand dollar might face selling pressure following a steady policy announcement by the RBNZ, the downside potential is expected to be limited. This is due to the perception that the RBNZ will take its time in lifting policy restrictions.
The forecast also considers the likelihood that the RBNZ will delay its rate cut announcement compared to the US Federal Reserve, providing room for the NZD/USD to increase to 0.6500 within the next 12 months.