Go Long on New Zealand Rates as RBNZ May Cut to 1.5%, CBA Says
Source: BFW (Bloomberg First Word)
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Philip Brown (Commonwealth Bank of Australia)
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UUID: 7947283
(Bloomberg) -- There is a “very good” chance that RBNZ cuts cash rate to 1.50% from 2.25% currently, Jarrod Kerr and Philip Brown, senior strategists at CBA, write in emailed note received today.
Alert: HALISTER1- “We upgrade our weighting in kiwi rates from ‘raging bulls’ to ‘break the limits long,’” they write in note; say kiwi rates now have much more value
- CBA says risks facing New Zealand economy are heavily tilted to downside
- Recommends following trades:
- Receive August overnight-index swaps at 1.98% to gain 48 bps
- Receive 2y3y swap at 2.77% to gain 57 bps
- Long New Zealand’s 2027 govt bond vs short Australia’s similar-maturity bond to gain 50 bps
- Says NZD is too high, inflation expectations are too low
Source: BFW (Bloomberg First Word)
People
Philip Brown (Commonwealth Bank of Australia)
To de-activate this alert, click here
UUID: 7947283