New Zealand’s central bank signaled it will keep interest rates on hold for longer as it lowered inflation forecasts and repeated calls for a weaker currency, sending the kiwi dollar to a seven-month low.
“It is prudent to undertake a period of monitoring and assessment before considering further policy adjustment,” Governor Graeme Wheeler said in Wellington after keeping the official cash rate at 3.5 percent, which is among the highest in the developed world. The Reserve Bank of New Zealand lowered its 90-day bank bill rate forecast, suggesting borrowing costs won’t rise again until the first half of 2015.
“This monetary policy statement was much more ‘dovish’ than we anticipated,” said Dominick Stephens, chief economist at Westpac Banking Corp. in New Zealand, who flagged he will push out his forecast for the next rate increase. “The RBNZ appears to have re-thought its inflation forecast in light of recent very soft inflation outcomes.”
Recommended Content
Editors’ Picks
EUR/USD regains traction, recovers above 1.0700
EUR/USD regained its traction and turned positive on the day above 1.0700 in the American session. The US Dollar struggles to preserve its strength after the data from the US showed that the economy grew at a softer pace than expected in Q1.
GBP/USD returns to 1.2500 area in volatile session
GBP/USD reversed its direction and recovered to 1.2500 after falling to the 1.2450 area earlier in the day. Although markets remain risk-averse, the US Dollar struggles to find demand following the disappointing GDP data.
Gold climbs above $2,340 following earlier drop
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
After the US close, it’s the Tokyo CPI
After the US close, it’s the Tokyo CPI, a reliable indicator of the national number and then the BoJ policy announcement. Tokyo CPI ex food and energy in Japan was a rise to 2.90% in March from 2.50%.