New Zealand Dollar loses its Iran-talks gain after RBNZ hold
The Reserve Bank of New Zealand (RBNZ) still has its rate at 2.75%, and NZD/USD has given back all of its climb on a weaker Dollar. It climbed off a session low just above 0.5600 to just under 0.5650 as the Dollar fell with Crude Oil on US-Iran diplomacy.
The New Zealand Dollar (NZD) has retraced its recent gains after the Reserve Bank of New Zealand (RBNZ) decided to hold its interest rate at 2.75% in their October 28 meeting. The NZD/USD currency pair fell back from just under 0.5650 to just above 0.5600, slightly below the beginning of the week's price range. The RBNZ’s decision to maintain rates, with only four votes in favor of holding against three, was seen as a surprise by the market.
The bank anticipates inflation to reach 4.4% by year-end, but chose not to raise rates despite this. NZD has also weakened against the Australian Dollar, as higher inflation in Australia raises expectations for more Reserve Bank of Australia (RBA) rate hikes. With New Zealand's third-quarter jobs figures due on Tuesday and the general election scheduled for November 7, NZD/USD has remained within a narrow range since October 29.
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