The New Zealand dollar started today’s trading session posting gains after the Reserve Bank of New Zealand decided to keep its key Official Cash Rate unchanged and hinted that the economy may expand.
The RBNZ left its main interest rate unchanged at 2.5 percent today. Bank’s Governor Alan Bollard mentioned in the statement after the decision the problems in Europe (one of the key trading partners of New Zealand):
Political and economic stresses in Europe, along with a run of weaker-than-expected data, have seen New Zealandâs trading partner outlook worsen. Furthermore, there is a small but growing risk that conditions in the euro area deteriorate more markedly than is projected in the June Statement.
Bollard explained that, on the negative side, the weakening global outlook hurt nation’s export. On the positive side, the Governor spoke about improving housing market and construction sector. According to central bank’s estimates, gross domestic product will rise just above 3 percent next year.
NZD/USD rose from 0.7750 to 0.7758 and NZD/JPY picked up from 61.51 to 61.57 as of 2:59 GMT today. EUR/NZD went down from 1.6197 to 1.6182.
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