New Zealand Dollar Rises as Incumbent Party Gains Election Edge

The New Zealand dollar rose to $0.556 on Monday, attempting to recover from a more than one-year low hit on Friday, as preliminary election results put the incumbent National Party in a stronger position to retain power. Prime Minister Christopher Luxon's centre-right party secured 42 seats, while the opposition Labour Party won 36. Neither party secured an outright majority, though National, combined with its coalition partners ACT and New Zealand First, could secure enough seats to maintain power if a coalition agreement is reached. The prospect of the incumbent coalition retaining power provided support for the kiwi, easing concerns over a potential Labour-led government and its plans to reinstate the Reserve Bank of New Zealand's dual mandate. However, the outcome remains uncertain, with official election results not expected until November 27.