FOREX TradingCharts.com

Forex News: NZ Dollar Falls As RBNZ Cuts Rate Unexpectedly,

NZ Dollar Falls As RBNZ Cuts Rate Unexpectedly, Flags Further Rate Reduction

05/08/2019 - 03:31:00 (RTTNews)

(RTTNews) - The New Zealand dollar nose-dived against its major opponents in the Asian session on Wednesday, after the Reserve Bank of New Zealand unexpectedly cut its official cash rate to a record low and suggested the possibility for further cuts citing uncertain global economic outlook and weak inflation.

The Monetary Policy Committee, chaired by Governor Adrian Orr, unanimously decided to reduce the OCR by 25 basis points to 1.5 percent from 1.75 percent.

Economists had expected the benchmark rate to remain at 1.75 percent, where it had been since November 2016.

Although employment is near its maximum sustainable level, the outlook for employment growth is more subdued and capacity pressure is expected to ease slightly in 2019. Consequently, inflationary pressure is expected to rise only slowly.

"Given this employment and inflation outlook, a lower OCR now is most consistent with achieving our objectives and provides a more balanced outlook for interest rates," according to the accompanying statement.

The RBNZ's projections signaled the possibility for another rate cut by March 2020. The latest forecasts show OCR falling to 1.4 percent in March 2020, compared to prior forecast of 1.8 percent.

Risk sentiment further dampened on worries about escalating U.S.-China trade tensions. U.S. Trade Representative Robert Lighthizer confirmed that the U.S. plans to raise tariffs on $200 billion worth of Chinese goods to 25 percent on Friday.

The NZ dollar declined to 0.6525 against the greenback, a level unseen since October 29, 2018. The pair was valued at 0.6601 at yesterday's close. On the downside, 0.64 is seen as the next support level for the kiwi.

The NZ dollar fell to 71.83 against the yen, its lowest since January 3. The pair was valued at 72.77 when it ended deals on Tuesday. Continuation of the kiwi's downtrend may see it challenging support around the 70.00 mark.

The kiwi lost 1.2 percent to a 4-month low of 1.7150 against the euro from yesterday's closing value of 1.6945. The kiwi is poised to find support around the 1.72 level.

The kiwi that closed yesterday's trading at 1.0617 against the aussie tumbled 1 percent to a 3-week low of 1.0723. The kiwi is likely to test support around the 1.09 region.

Looking ahead, at 8:15 am ET, Canada housing starts for April are due.

At 8:30 am ET, Federal Reserve Governor Lael Brainard will deliver a speech at a Community Listening Session hosted by the Federal Reserve Bank of Richmond.

For comments and feedback: contact editorial@rttnews.com

Copyright(c) 2019 RTTNews.com. All Rights Reserved

Market News provided by RTTNews

RECENT FOREX and ECONOMIC NEWS STORIES


Canadian Dollar Higher On Rising Oil Prices (08 min(s), 09 sec(s) ago)
(RTTNews) - The Canadian dollar drifted higher against its major counterparts in the European sess ...Full Story»

Pound Falls On Brexit Concerns (01 hr(s), 56 min(s), 09 sec(s) ago)
(RTTNews) - The pound declined against its major counterparts in the European session on Tuesday, ...Full Story»

U.S. Dollar Appreciates Against Majors (05 hr(s), 50 min(s), 09 sec(s) ago)
(RTTNews) - The U.S. dollar drifted higher against its major counterparts in the early European se ...Full Story»

U.S. Dollar Reverses From Early Highs Against Most Majors (09 min(s), 51 sec(s) ago)
(RTTNews) - The U.S. dollar declined against its most major counterparts in the European session o ...Full Story»

Aussie Up After Australia Conservative Coalition's Surprise Election Victory (05 hr(s), 20 min(s), 09 sec(s) ago)
(RTTNews) - The Australian dollar gained ground against its major opponents in the Asian session o ...Full Story»

Euro Little Changed Following German PPI (07 hr(s), 08 min(s), 09 sec(s) ago)
(RTTNews) - After the release of German producer prices for April at 2:00 am ET Monday, the euro c ...Full Story»

Euro Retreats Ahead Of German PPI (07 hr(s), 17 min(s), 08 sec(s) ago)
(RTTNews) - Destatis will release German producer prices for April at 2:00 am ET Monday. Ahea ...Full Story»

Dollar Ticks Up Following U.S. Consumer Sentiment Index (57 min(s), 51 sec(s) ago)
(RTTNews) - Following the release of University of Michigan's preliminary consumer sentiment i ...Full Story»

Search

FOREX NEWS

Canadian Dollar Higher On Rising Oil Prices

05/21/2019 - 09:03 AM (RTTNews)
(RTTNews) - The Canadian dollar drifted higher against its major counterparts in the European sess ...Full Story>>

Pound Falls On Brexit Concerns

05/21/2019 - 07:15 AM (RTTNews)
(RTTNews) - The pound declined against its major counterparts in the European session on Tuesday, ...Full Story>>

U.S. Dollar Appreciates Against Majors

05/21/2019 - 03:22 AM (RTTNews)
(RTTNews) - The U.S. dollar drifted higher against its major counterparts in the early European se ...Full Story>>

U.S. Dollar Reverses From Early Highs Against Most Majors

05/20/2019 - 10:22 AM (RTTNews)
(RTTNews) - The U.S. dollar declined against its most major counterparts in the European session o ...Full Story>>

Aussie Up After Australia Conservative Coalition's Surprise Election Victory

05/20/2019 - 03:53 AM (RTTNews)
(RTTNews) - The Australian dollar gained ground against its major opponents in the Asian session o ...Full Story>>
Copyright © 2019. All market data is provided by Barchart Solutions. Information is provided "as is" and solely for informational purposes, not for trading purposes or advice. To see all exchange delays and terms of use, please see disclaimer.