Kiwi dives after RBNZ cuts rates, Aussie ascends
On Thursday, the New Zealand dollar tumbled against its American rival, after the Reserve Bank of New Zealand dared to lower interest rates by 25 basis points, while the Australian dollar soared.
The currency pair NZD/USD dipped 0.12%, hitting 0.7269, the lowest value since November 2.
In a widely expected move, the RBNZ managed to decrease its benchmark interest rate from 2.00% to a new record-minimum of 1.75%.
Commenting on the decision, RBNZ Governor Graeme Wheeler told that interest rates require staying there until the end of 2019, though he added that numerous uncertainties remain, especially in respect of the international outlook, and policy might need to adjust accordingly.
The currency pair AUD/USD surged 0.60%, trading at 0.7682.
Meanwhile, the US dollar came under pressure as market participants were still digesting Donald Trump’s win at the American presidential election and the implications his presidency could bring to financial markets.