NZ Dollar Soft Following RBNZ Policy Decision

The New Zealand dollar was flat-to-lower today following yesterday’s policy decision announced by the Reserve Bank of New Zealand.

The RBNZ left key interest rate unchanged at 1.75% as was widely expected. The central bank had mixed outlook for the domestic economy, saying:

Global economic growth continues to improve, although inflation and wage outcomes remain subdued

The bank was not concerned about the exchange rate:

The exchange rate has eased since the August Statement and, if sustained, will increase tradables inflation and promote more balanced growth.

Overall, analysts considered the statement to be somewhat more hawkish than was expected. Still, the RBNZ showed no intention to raise interest rates in the near future, stating:

Monetary policy will remain accommodative for a considerable period.

NZD/USD traded at 0.6954 as of 10:08 GMT today after opening at 0.6962. EUR/NZD edged up from 1.6636 to 1.6670. NZD/JPY dropped from 79.27 to 78.89.

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