Mon, Jul 22, 2024

NZD: NZD/USD nears 0.6090 as RBNZ Orr emphasizes need for restrictive policy.

RBNZ Governor ORR spoke today shows hawkish policy stance. Inflation remaining elevated in the near term, So Policy standing at the current term. Policy gets Normal in 2025. But growth seen in 2024.

NZDUSD is moving in Ascending channel and market has reached higher low area of the channel

NZDUSD is moving in Ascending channel and market has reached higher low area of the channel

NZD/USD Ends Four-Day Slide on RBNZ Governor’s 2025 Normalization Outlook

Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr’s comments on Friday led NZD/USD to break its four-day losing streak. Orr projected the commencement of policy normalization in 2025, citing an as-expected economic progression with decreasing inflation expectations. While inflation remains elevated, it shows a downward trend. Orr stressed the necessity of maintaining a restrictive monetary policy and anticipated economic growth in 2024.

The US Dollar Index (DXY) holds near 104.10, despite improved US Treasury bond yields (2-year: 4.63%, 10-year: 4.25% at publication). The US Dollar (USD) gained ground post the Federal Reserve’s release of the US Personal Consumption Expenditures – Price Index, meeting expectations. However, expectations for the Fed’s rate cut shifted due to recent US Gross Domestic Product (GDP) data, supporting the USD.

US GDP growing

US Personal Consumption Expenditure (PCE) Price Index grew 2.4% YoY in January, in line with expectations, with a 0.3% MoM increase. The US Core PCE rose 2.8% YoY, slightly lower than December’s 2.9%, aligning with consensus estimates, and a monthly increase of 0.4%, surpassing the previous 0.1%. Investors await the final US S&P Global Manufacturing PMI for February.

NZD: NZ Central Bank Advocates Prolonged Restrictive Policy

RBNZ Governor ORR spoke today shows hawkish policy stance. Inflation remaining elevated in the near term, So Policy standing at the current term. Policy gets Normal in 2025. But growth seen in 2024.

RBNZ Deputy Governor: Restrictive Policy Vital for Inflation Anchoring

EURNZD Analysis is moving in the Descending triangle pattern and the market has rebounded from the horizontal support area of the pa

EURNZD Analysis is moving in the Descending triangle pattern and the market has rebounded from the horizontal support area of the pa

Reserve Bank of New Zealand Deputy Governor Christian Hawkesby highlighted the necessity of maintaining restrictive interest rates in New Zealand to fully anchor inflation expectations. In an interview with Reuters, Hawkesby emphasized the importance of confidence in anchoring inflation and core inflation back to the 2% target, requiring a period of the economy running below its potential. Despite holding the official cash rate at 5.5%, the RBNZ projected ongoing rates until mid-2025, acknowledging balanced inflation risks.

Newzealand GDP data shows higher numbers yesterday morning Newzealand Dollar benefitted from All Domestic data in line with expectations.

Hawkesby acknowledged the effectiveness of current restrictive policy but indicated uncertainty about the timing of future rate cuts. Governor Orr cited external risks, such as China’s economic slowdown, as significant concerns for New Zealand’s economy.

NZD: RBNZ Governor Orr: Inflation Still Elevated, On a Decline

RBNZ Governor ORR spoke today shows hawkish policy stance. Inflation remaining elevated in the near term, So Policy standing at the current term. Policy gets Normal in 2025. But growth seen in 2024.

GBPNZD is moving in Descending channel and market has reached lower high area of the channel

GBPNZD is moving in Descending channel and market has reached lower high area of the channel

Economy unfolding as expected, with decreasing inflation expectations. Inflation, although still elevated, is on a downward trend. Monetary policy should remain restrictive for a while. Anticipates policy normalization by 2025 and foresees economic growth picking up in 2024.


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