Bias: The NZD/PHP is bullish-to-range-bound, sitting above the 90-day average and in the upper half of the 3-month range.
Key drivers:
• Rate gap: The Reserve Bank of New Zealand's recent policy easing contrasts with the Bangko Sentral ng Pilipinas maintaining its rates, which may support the NZD.
• Risk/commodities: With global oil prices remaining stable, the NZD could benefit as New Zealand is a commodity exporter, while the PHP faces challenges from import costs.
• One macro factor: Weak growth prospects in the Philippines, as indicated by ANZ, are likely to keep pressure on the PHP and hinder its rebound potential.
Range: The NZD/PHP is expected to test extremes within its recent stable range, but further volatility is possible due to external factors.
What could change it:
• Upside risk: Stronger-than-expected economic recovery in New Zealand could bolster the NZD further.
• Downside risk: Heightened global trade tensions affecting New Zealand’s exports may weaken the NZD against the PHP.