NZD/WST Outlook: The New Zealand dollar to Samoan Tālā exchange rate is likely to increase, positioned at 90-day highs and supported by the ongoing demand for NZD.
Key drivers:
- Rate gap: The Reserve Bank of New Zealand's recent interest rate cuts create a favorable environment for the NZD compared to the Central Bank of Samoa's policy aimed at reducing liquidity.
- Risk/commodities: New Zealand's economic prospects, despite recent data showing a contracting private sector, remain relatively positive, potentially supporting the NZD.
- One macro factor: Upcoming changes from the New Zealand general election might influence the economic landscape and bolster confidence in the NZD.
Range: The NZD/WST is expected to hold within its recent range as the exchange rate capitalizes on current momentum.
What could change it:
- Upside risk: Stronger-than-expected economic data from New Zealand could further boost confidence in the NZD.
- Downside risk: Escalating trade tensions affecting New Zealand's export revenues could put pressure on the NZD.