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New Zealand Dollar Exchange Rate Subdued Ahead of RBNZ Meeting

Yesterday’s high: NZ$1.7799

Yesterday’s low: NZ$1.7715

NZD Slides on RBNZ Rate Speculation

The New Zealand Dollar fell against many of its peers on Tuesday as markets speculated that the Reserve Bank of Australia (RBNZ) is likely to adopt a more dovish tone in its meeting on Thursday, possibility signalling that rates will remain unchanged for years to come.

The ‘Kiwi’ also continued to be weakened by the recent uptick in the US Dollar as markets continued to shift away from riskier assets like the New Zealand Dollar following upbeat US employment data.

Meanwhile the Pound was weakened on Tuesday as recent comments from former chief mandarin at the Foreign Office, Sir Simon Fraser caused some concerns over the state of the UK’s Brexit talks as he suggested that a spilt in the cabinet was hindering negotiations with the EU.

NZD Outlook: RBNZ to Strike Dovish Tone in Policy Meeting?

As mentioned above the RBNZ policy meeting is likely to be the main focus for NZD investors this week with the New Zealand Dollar expected to fall if the bank indicates that rates are unlikely to rise in the near future.

Meanwhile the Pound is also likely to struggle later this week as the UK’s latest trade figures are expected to report that the nation’s trade deficit rose from £3.07bn to £3.6bn at the end of second quarter.

Sterling losses may also be extended on Thursday by the release of Britain’s latest Industrial production data, which is expected to show that UK factory output contracted for the third consecutive month in June.

Key Events

9th August

22:00 RBNZ Interest Rate Decision

10th August

09:30 UK Trade Balance June

09:30 UK Industrial Production June

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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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