Pursuits
New Zealand Cuts Interest Rates to Record Low; Kiwi Soars
- Governor Wheeler signals at least one more rate reduction
- Easing disappoints investors, sending Kiwi to one-year high
Kiwi Soars After New Zealand Cuts Rates to Record Low
This article is for subscribers only.
New Zealand’s central bank cut interest rates to a fresh record low and flagged more easing to combat low inflation, disappointing some investors who were looking for a more aggressive signal. The local dollar surged.
“Our current projections and assumptions indicate that further policy easing will be required to ensure that future inflation settles near the middle of the target range,” Reserve Bank Governor Graeme Wheeler said in a statement Thursday in Wellington, after lowering the official cash rate by a quarter point to 2 percent. The central bank’s forecasts indicated at least one more rate reduction is likely.