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It has been a very similar story with New Zealand Dollar. We have not had exactly a very strong data in New Zealand in the period. Most in the market expects the Reserve Bank rising the interest rate and taking back the emergency cap from early last year. The longer that lasts, the less support there is for the New Zealand Dollar. The New Zealand Dollar has outperformed the Australian Dollar, because Aussie and Kiwi crosses have come down from the 1.30 level down to 1.27 where we are at the moment. AUD/USD is falling at the moment, NZD/USD is still weaker pretty much , exactly due to the same factors why the Australian Dollar is down over that period. However, the Australian Dollar has been more sensitive compared with the New Zealand. Therefore, the Aussie has fallen more than Kiwi over that period.
We have got the AUD/USD down at parity by the middle of this year. That is driven by the fact that we have more RBA cap coming during the next six months. We still might think that China has reached a cross point, after which the economic growth will either stagnate or decrease. Therefore, given the AUD/USD is at 1.03 at the moment, we are expecting the pair to be trading at parity by the end of the second quarter . The key drivers will be lower domestic interest rates in Australia, softer global backdrop, which will put pressure on commodity prices. Similar factors are influencing the New Zealand Dollar over the same period. We have got the Kiwi down to 78 cents against the US Dollar.
As we move through the next half of this year, we think that the both currencies are going to rebound. That is driven by the premise that we expect policy stimulus in the major economies in terms of the US with further quantitative easing, in Europe and also China. We believe that towards the end this year the global economy is going to be on firmer footing that is going to boost commodity prices; the RBA will be forced to stop lower-ing the interest rate, thus the currency will start to recover.
At the end of the year the AUD/USD will back up 1.04, NZD/USD will appreciate to 0.81 after those lower points in the middle of the year.