NZ Dollar Trades Lower As RBNZ Hints At Rate Cut Possibility
26 Marzo 2019 - 09:02PM
RTTF2
The New Zealand dollar slipped against its major counterparts in
the Asian session on Wednesday, after the Reserve Bank of New
Zealand left its key rate unchanged and shifted its neutral stance,
flagging the possibility for lowering its cash rate in coming
months.
The central bank maintained its official cash rate at a record
low of 1.75 percent for the 16th straight meeting.
The decision was in line with expectations.
Given the weaker global economic outlook and reduced momentum in
domestic spending, the likely direction of the next OCR move is
down, RBNZ Governor Adrian Orr noted.
"We will keep the OCR at an expansionary level for a
considerable period to contribute to maximizing sustainable
employment and maintaining low and stable inflation," Orr said.
Meanwhile, Asian stock markets were mixed despite the positive
cues overnight from Wall Street as lingering worries about global
economic growth weighed on investment sentiment. Overnight,
long-term U.S. government bond yields pulled back off their best
levels following the release of some disappointing U.S. economic
data.
The kiwi declined to near a 3-week low of 75.08 against the yen,
and held steady thereafter. This follows a high of 76.46 seen at
5:00 pm ET. On the downside, 73.00 is likely seen as the next
support for the kiwi.
The kiwi slipped to a 6-day low of 1.6564 against the euro, from
an early 2-1/2-year high of 1.6292, and held steady thereafter. The
kiwi is seen challenging support around the 1.68 region.
The NZ currency weakened to near a 4-week low of 1.0453 against
the aussie and more than a 2-week low of 0.6796 against the
greenback, from its previous highs of 1.0309 and 0.6914,
respectively. The currency traded sideways against the aussie and
the greenback afterwards. Next key support for the kiwi is likely
seen around 1.06 against the aussie and 0.66 against the
greenback.
Looking ahead, at 4:00 am ET, European Central Bank President
Mario Draghi will deliver speech at the ECB and Its Watchers
conference in Frankfurt.
In the New York session, U.S. and Canadian trade data for
January and U.S. current account data for the fourth quarter are
scheduled for release.
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