New Zealand dollar rose after RBNZ highlights no significant change in monetary policy outlook. With further easing not likely to happen, NZD/USD could rise higher.
Reserve Bank of New Zealand (RBNZ) kept rates unchanged as widely expected at 1.00%. This comes after cutting rates by 50bps last month. The central bank’s sentiment mirrored that of Royal Bank of Australia (RBA), looking to ease only if necessary.
In its monetary statement, RBNZ said that its monetary policy outlook remains unchanged, implying that further easing is not required. Furthermore, they said that employment is around its maximum sustainable level and inflation is within target.
The global trade and other geopolitical tensions are still the main concern and NZ interest rates are expected to be lower for longer.
NZD/USD could rise from its three-year low towards the 0.6430 price level.
Fullerton Markets Research Team
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