NZD/CAD Outlook:
Slightly positive, but likely to move sideways as the NZD is above its recent average but lacks a clear driver.
Key drivers:
• Rate gap: The Reserve Bank of New Zealand is signaling potential interest rate cuts, while the Bank of Canada has kept rates steady, creating contrast.
• Risk/commodities: Oil prices have begun to rise, support for the CAD, yet ongoing volatility limits its strength.
• One macro factor: Concerns over New Zealand's labour market performance have contributed to the NZD's recent fluctuations.
Range:
Expect the NZD/CAD to hold within its recent stable range, but with potential slight shifts depending on emerging news.
What could change it:
• Upside risk: A rebound in global risk appetite could strengthen the NZD.
• Downside risk: Continued weakness in the NZ labour market could pressurize the NZD further.
