New Zealand dollar lifts near $0.596 on RBNZ tightening hopes
The New Zealand dollar rose to around $0.596 on Friday, supported by expectations the Reserve Bank will keep tightening this year. Economists widely expect a 25 basis point cash rate hike next week.
The New Zealand dollar rose to around $0.596 on Friday, supported by expectations that the Reserve Bank will continue to tighten policy this year.
Economists widely expect the RBNZ to raise its cash rate by another 25 basis points next week, with two-thirds anticipating at least one more hike, potentially taking the rate to 3% or higher by December.
The outlook follows the RBNZ’s first rate increase in more than three years in July, when the central bank indicated that further tightening may be needed to bring inflation back to its target.
Externally, investors are awaiting Federal Reserve Chair Kevin Warsh’s first Jackson Hole speech later today for clues about the likelihood of a September rate move.
Meanwhile, efforts to secure a deal over the Strait of Hormuz encountered another setback after reports that President Trump is no longer interested in reviving the June agreement with Iran.
Despite Friday’s advance, the kiwi is down 0.2% for the week.