FX.co ★ New Zealand Dollar Jumps After RBNZ Decision

The New Zealand dollar appreciated by over 1%, reaching $0.568, its highest point in three weeks. This movement followed the Reserve Bank of New Zealand's decision to reduce interest rates as anticipated, alongside signals suggesting an impending conclusion to its current cycle of policy easing. The RBNZ decreased its cash rate by 25 basis points to 2.25%, marking the lowest level since June 2022, in an effort to bolster a tepid economic recovery. However, the central bank's revised forecasts carry a more hawkish stance. Forward guidance now anticipates the cash rate to dip slightly to 2.2% in the second quarter of the upcoming year, indicating only a limited probability of further cuts. By the close of 2026, the rate is projected to edge up to 2.28%. Consequently, traders significantly reduced their expectations for additional monetary easing.