The New Zealand dollar fell against some of its most traded rivals, including the US dollar and the Japanese yen, today. The most likely reason for the losses was the slowing producer inflation in China, New Zealand’s major trading partner.
China’s Producer Price Index rose 3.3% in October from a year ago. While the reading was within market expectations, it was slowdown from the September’s 3.6% rate of growth. The Consumer Price Index rose 2.5%, also matching expectations.
Yesterday overnight, the Reserve Bank of New Zealand announced its policy decision. To no one’s surprise, the central bank kept the main interest rate at 1.75%. The bank signaled that it is not planning to raise interest rates in the foreseeable future:
The Official Cash Rate (OCR) remains at 1.75 percent. We expect to keep the OCR at this level through 2019 and into 2020.
NZD/USD ticked down from 0.6751 to 0.6743 as of 10:54 GMT today. NZD/JPY declined from 77.00 to 76.75. EUR/NZD traded at 1.6825, close to its opening level of 1.6816.
If you have any questions, comments or opinions regarding the New Zealand Dollar,
feel free to post them using the commentary form below.
