The New Zealand dollar is still a "sell on rallies" currency and could trade at an all-time low of 43.40USc in coming weeks, the Bank of New Zealand said yesterday.
The kiwi closed on local currency markets at 45.22USc, up slightly on its 45.18c close on Friday, but the aussie was down to 59.02USc from 59.35c on Friday.
In its foreign exchange market commentary, the BNZ said the market would be looking for fresh inspiration following last week's "directionless" trading.
The US Federal Reserve meeting this week was unlikely to provide any new direction, with market participants reasonably confident rates would be left on hold, the BNZ said.
The outlook for the kiwi wasn't good - the euro was failing to hold its gains against the greenback, which meant further downside looked likely for the New Zealand dollar.
"Strong trendline resistance is noted at 45.55USc, which should form the top side of the range on the week.
"The New Zealand dollar has bounced strongly off the 44.75-80c region several times and this level will form good support initially but we are looking for a break to fresh lows in the coming weeks," the bank said.
"A break of 44.60USc will see a test of trendline support at 44.40c then a move lower to 43.40c."
But on the cross-rates yesterday the kiwi was stronger against all other major currencies, closing at 76.62Ac (76.38Ac on Friday), 48.90 yen (48.79), 30.33 pence (30.22), 0.9746 marks (0.9660), 0.7777 Swiss francs (0.7728) and 0.4982 euros (0.4941).
- NZPA
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