{
  "id": 4585827,
  "title": "Kiwi braces for RBNZ decision, Aussie tries to steady after setback",
  "url": "https://urgent.news/2026/08/31/kiwi-braces-for-rbnz-decision-aussie-tries-to-steady-after-setback",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-08-31T06:48:10.000Z",
  "source": {
    "name": "Business Recorder",
    "slug": "business-recorder",
    "url": "https://www.brecorder.com/news/40437211/kiwi-braces-for-rbnz-decision-aussie-tries-to-steady-after-setback"
  },
  "original_language": "en",
  "account": "The New Zealand dollar rose slightly on Monday as traders anticipated an interest rate increase by the Reserve Bank of New Zealand (RBNZ) during a meeting scheduled for Wednesday. Meanwhile, the Australian dollar struggled to maintain its upward momentum following a setback caused by a rise in the US dollar. The kiwi currency increased by 0.2% to $0.5919, recovering from a 0.6% decline on Friday when it ended 1% lower over the previous week. It has a support level at the $0.5860 and $0.5821 marks, and is expected to close August 0.6% higher.\n\nThe RBNZ is expected to raise interest rates by 0.25 percentage points to 2.75% during the meeting, although the extent of the rate increase is uncertain due to new economic forecasts. Oil prices surged by over 2% on Monday as tensions escalated between the United States and Iran, raising concerns about inflation. Investors are anticipating interest rates to reach 3.0% by December and 3.5% in the following year as the central bank transitions from stimulus measures to a more neutral policy stance.\n\nFX strategist Francesco Pesole from ING believes there are downside risks for the NZD during the RBNZ meeting, given the high bar for the central bank to meet market expectations. If the RBNZ proves less hawkish than anticipated, it could limit gains and keep the currency around the $0.60 level. In contrast, the Australian dollar rose by 0.2% to $0.7170, after falling by 0.5% on Friday and breaking an eight-week winning streak. It also fell from a three-month high of $0.7208, with support now at around $0.7137 and $0.7067. For the month, the Aussie is projected to gain 2.1%.\n\nOn Monday, data showed that Australian inventories likely shaved 0.3 percentage points off the country's gross domestic product (GDP) in the second quarter, with the economy likely expanding by a modest 0.3% in the quarter. A Reuters poll revealed that the annual pace of economic growth is slowing to 1.8%. Private-sector credit growth eased in July as three interest rate hikes this year worked to curb demand. Housing credit rose by 0.5% in the month, easing from 0.6% in June, while business credit remained robust at 0.9%.\n\nThe likelihood of persistent inflation is the primary reason markets are betting on a 56% probability of the RBA hiking interest rates for a fourth time next month. A November hike is almost certain. Chief economist at HSBC, Paul Bloxham, stated that the RBA faces difficult choices. If growth is weak and inflation remains high, the central bank may avoid further rate hikes to prevent pushing the economy into a deeper recession. However, if growth is stronger, the RBA may need to raise rates further to suppress inflation, potentially risking a more significant economic downturn.",
  "summary": "SYDNEY: The New Zealand dollar edged higher on Monday as traders braced for a widely expected interest rate hike at home, while the Aussie was trying to recover momentum after a US dollar induced setback. The kiwi dollar rose 0.2% to $0.5919, after slipping 0.6% on Friday to finish 1% lower last week. It has support at the $0.5860 and $0.5821 levels and is set to end August 0.6% higher. The…",
  "key_points": [
    "New Zealand dollar rises slightly ahead of RBNZ meeting",
    "Australian dollar struggles after US dollar rise",
    "RBNZ expected to increase rates by 0.25 percentage points"
  ],
  "editors_take": "Anticipated interest rate hikes by the Reserve Bank of New Zealand and the Reserve Bank of Australia signal a shift towards neutral policy stances, impacting currency valuations and economic growth trajectories.",
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}