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Morgan Stanley Sees Kiwi at Two-Year Low

  • High household debt levels vulnerable to Fed hikes, Blake says
  • Kiwibank is bearish as it sees the terms of trade weakening
kiwi dollar

Photographer: Brent Lewin/Bloomberg

Updated on

The worst is yet to come for the poorest performing Group-of-10 currency, Morgan Stanley says.

New Zealand’s dollar will drop another 4 percent by year-end as rising household debt levels leave the economy vulnerable to higher U.S. interest rates, the New York-based bank says. Kiwibank Ltd. is also negative it sees the terms of trade weakening, while technical analysis shows the currency is on the brink of breaking below a key support level.