The New Zealand dollar held near a six-week high around $0.584, as expectations of further domestic interest rate hikes helped counter a broader risk-off mood driven by escalating US–Iran tensions. The Reserve Bank of New Zealand is widely anticipated to raise rates again in September, with the Official Cash Rate seen reaching at least 3.0% by year-end.
Earlier this week, RBNZ Chief Economist Paul Conway cautioned that renewed conflict in the Middle East could rekindle inflationary pressures, potentially forcing the central bank to tighten policy further following last week’s first rate increase in more than three years.
At the same time, the US dollar rebounded from a near one-month low after fresh data underscored the continued resilience of the US economy, limiting additional upside in the kiwi. For the week, the New Zealand dollar advanced more than 1%, recording its third consecutive weekly gain.
