New Zealand’s central bank will discuss interest rates next Wednesday (August 17), Citi and BOC Hong Kong （02388）
Qi expects to increase interest rates by half a percentage point, while Citigroup expects the New York central bank to increase by 1 percentage point by the end of this year, and this round of interest rate hike cycle will end. In addition, the Bank of Hong Kong recently rushed to increase the New Zealand dollar time deposit interest.
Gao Yaohao, senior wealth consultant of the Wealth Advisory Department of the Personal Digital Financial Products Department of BOC Hong Kong, responded to the query, saying that since April, the New Zealand central bank has raised interest rates by 0.5% in three consecutive interest rate meetings. The last interest rate meeting was decided on July 13, and the second-quarter consumer price index released on July 18 was at a 30-year high. As the country’s CPI is released quarterly, it is more difficult for the New York Central Bank to combine the latest inflation data for reference in the next interest rate meeting, so it is expected that the interest rate will still be raised by 0.5% next week to further curb inflation first.
Gao Yaohao also said that the current overnight index exchange rate will be reflected in November this year, during which there will be 3 interest rate meetings. The New Zealand cash rate will reach 3.8%, which is an increase of 1.3% compared with the current interest rate level. Interest rates will not peak until February 2023.
3 major commodity currencies, BOC’s preferred Canadian dollar
However, Gao Yaohao added that the quarterly business survey just released by the New Zealand central bank showed that inflation expectations for two years have begun to fall, which will have a certain impact on future interest rate hike expectations. As New Zealand’s rate hike cycle starts earlier than other regions and is actively advancing, the risk is that if inflation falls earlier than other countries, the final rate hike may be less than the rate hike currently reflected in the market. Investors have certain concerns about this. Be wary.
Talking about the Australian, New Zealand and Canadian dollars, Gao Yaohao believes that the three commodity currencies are facing the possibility of a potential global economic recession at the same time, but the Canadian economy is highly correlated with the United States and oil prices. The Canadian dollar benefited from rising demand in the winter, which should support oil prices in the second half of the year. On the other hand, the Bank of Canada is currently one of the most hawkish central banks. The governor said earlier that he would speed up interest rate hikes and control inflation first, so as not to have a greater impact on the economy in the future. Therefore, interest rates in Canada should keep pace with the pace of the Federal Reserve. , and may eventually exceed market expectations, so from the midline, the Canadian dollar has a greater advantage among the three commodity currencies.
Citi most bullish on AUD, 3-month target of 0.68
Liao Jiahao, head of Citibank’s investment strategy and global wealth planning department, responded to this newspaper’s inquiry that it is expected that the New Zealand central bank may raise interest rates by 50 basis points this time, and then may raise interest rates by 25 basis points in October and November, which means that the interest rate may be raised to 3.5 by the end of this year. 1% higher than the current policy rate of 2.5%.
Asked which of the three major commodity currencies is the most valuable, Liao Jiahao bluntly said that he is most optimistic about the Australian dollar. First, the RBA’s rate hike cycle may not end until the first quarter of next year, which is longer than Canada and New Zealand. Furthermore, the fundamentals of the Australian economy are still strong, the unemployment rate is at a record low, and the property market is still booming.
Liao Jiahao predicts that the Australian dollar is expected to reach 0.68 within 3 months, challenge 0.69 in half a year to one year, and test 0.76 in the two-year long-term target. The Canadian dollar is expected to see 1.32 in 3 months to 1 year, and the long-term target challenges 1.25. The current exchange rate of the New Zealand dollar is tentatively reported at 0.64. Liao Jiahao estimates that it will see 0.61 in 3 months, slightly rebound to 0.62 in half a year to 1 year, and the long-term target price is 0.67.
On the other hand, Chinese banks including ICBC (Asia) and China Merchants Wing Lung (CMB Wing Lung) have recently increased the NZD fixed deposit interest rate, and Citigroup has increased the one-month annual interest rate by 1% to 3.5%.However, the 7-day high-interest rate option is still the most popular, such as Hang Seng （00011）
and Nanshang Qi is 8.5%, BOCHK （02388）
The same short-term deposit as Chiyu is 10%. HSBC (HSBC) has previously raised it by 2% to 10.5%, but it is not as good as Fubon, which is the city’s top 11.88%.
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Special correspondent: Zeng Guifen
Responsible editor: Chen Chuyuan