The New Zealand dollar – commonly known as the Kiwi – fell to the lowest level since December. This came after the country’s central bank released its interest rate decision and a statement.
In today’s meeting, the officials decided to leave interest rates unchanged at 1.75% and removes chances of a rate hike in the near future. In the statement, the officials expressed concerns that inflation, being below the targeted 2% was still a problem. In March, the annual inflation rate fell to 1.1%, which was lower than the previously reported 1.6%. As a result, the officials projected that the annual inflation for the year will remain at 1.4%.
This was compounded by the slow growth in wages. They also expressed increasing risks in global trade, fueled mostly by the increasing threats to global trade. This is especially important for a country that derives most of its income from imports.
The pair is now trading at 0.6910, which is the lowest level since December last year. The declines have been contributed by the ongoing dollar strength. The dollar strength has been contributed by the increasing treasury yields and a hawkish fed. The pair is likely to continue moving lower, although the US CPI data to be released later today will be very important.