MS say they are neutral on the Kiwi against the US dollar but bullish on it against the Australian.
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- We are neutral on NZD/USD still but risks are increasingly skewed to the downside as the chances of a broader-based USD rally are rising.
- We continue to like AUD/NZD shorts as a structural expression of RBA-RBNZ policy divergence as the RBNZ's "Great Hawkish Shift" should continue over time
- We might consider re-entering NZD longs at a future date should the currency weaken enough which would render risk/reward sufficiently attractive, though we are not yet at that point especially if positioning is likely to adjust further
