Kit Juckes, Chief Global FX Strategist at Société Générale, believes that the New Zealand Dollar still looks a better buy than Aussie.

AUD and NOK may be the two G10 currencies most at risk of a New Year hangover

“The RBNZ is the only central bank that is more hawkish than the Fed, and rate differentials are much more friendly. Likewise, Australian/Kiwi rate differentials suggest there’s more downside to AUD/NZD, even now.”

“There is still one caveat, of course: If the global equity market bounce runs out of steam, then given the levels of correlations between risk sentiment and currency trends, I can’t see NZD (or AUD, NOK or SEK) completing bucking that trend.”

“Valuations in G10FX are however, still very friendly – AUD, NZD, CAD, JPY and SEK are all at very cheap levels. The conclusion – AUD and NOK may be the two G10 currencies most at risk of a New Year hangover.”