Cites real estate in the medium term.
Deutsche Bank sees the AUDNZD moving to parity from the current level of about 1.03000.
They say:
"This week's RBA statement once more reiterated policymakers sensitivity to house price inflation, which has similarly constrained the RBNZ in easing policy . To the extent that the real estate bubbles are a hawkish factor in both reserve banks decision-making, they appear equally supportive of the AUD and the NZD.
Yet for medium-term investors looking beyond near-term policy decisions, the nature of the real estate boom in Australia should have bearish currency implementations because it leads to deterioration in the basic balance.
This is not the case in New Zealand and adds to our conviction that AUDNZD should drop parity. We believe this is the fundamental difference between the Antipodeans."
Technically (this is from me), the AUDNZD traded at the lowest level since April 28, 2015 today. The low from 2015 came in at 1.0012. Looking at daily chart below, the low today has found support at what defined the low area back in March/April of 2015 at the 1.0255-62 area. Get below that area, and the downside can be further explored with trend lines the next focus before heading to the parity level.
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