FX News

NZD/USD Transfer:

The New Zealand Economy contracted more than expected in the fourth quarter of 2022. Figures shown reflecting a downturn in growth of -0.6% compared to the forecast figure of -0.2%. The big question to come out of this release is whether the RBNZ will continue to hike rates to 5.5% or halt. We predict another 25 points to 5.00% is all that’s needed in this policy tightening cycle. Let’s be honest here- New Zealanders are already hurting. The RBNZ always said they would continue to hike into a recession, and we are halfway there. Of note the original calculation put GDP at -1.2% but with the new seasonally adjusted calculation method it wasn’t as worse. Of the 16 industries 9 experienced declines in activity with manufacturing down 1.9%, household spending has been flat, but expectations are for this to worsen over the coming months. The kiwi dived around 80 points on the release but recovered somewhat into last night’s US market open and hovers around a steady 0.6170 this morning.

The current interbank midrate is: NZDUSD 0.6191
The interbank range this week has been: NZDUSD 0.6138- 0.6263

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