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New Zealand Dollar Exchange Rate Plummets Following RBNZ Meeting

Yesterday’s high: NZ$1.7897

Yesterday’s low: NZ$1.7809

NZD Slides on RBNZ Rate Speculation

The New Zealand Dollar plummeted against the other majors on Thursday following the Reserve Bank of New Zealand’s vote to leave monetary policy unchanged.

While the decision to leave interest rates at 1.75% was not a surprise, further indications that the bank is likely to leave rates on hold for the next couple of years caused the ‘Kiwi’ to plummet.

NZD sentiment fell even further overnight on Thursday as the local Business PMI missed expectations, revealing a slump in domestic manufacturing activity in July.

Meanwhile, the Pound also came under pressure yesterday as the ONS reported that the UK’s trade deficit widened to a new nine-month high in June, climbing from -£2.52bn to -£4.56bn.

NZD Outlook: Retail Data to Pressure NZD Next Week?

The New Zealand Dollar may register more losses at the start of next week following the release of the local Services PMI, with economists predicting that the index will show a drop in activity in the services sector last month.

The ‘Kiwi’ may come under even more pressure during Monday’s session as New Zealand’s latest retail figures are expected to report a dip in sales in the second quarter.

Meanwhile, the Pound may strengthen on Tuesday if the UK’s inflation rate holds at 2.6%, although concerns over its impact on consumer spending could hinder Sterling gains.

Key Events

13th August

11:30 NZ Services PMI July

11:45 NZ Retail Sales Q2

15th August

09:30 UK Inflation Rate July

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To keep up to date with the New Zealand Dollar, visit the NZD blog in our Currency News section.

Joe Mayhew

Senior Currency Broker
T: 01442 892 060

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