NZ Dollar Rises as US Dollar Weakens, Inflation Drops
Solid ECN – The New Zealand dollar has recently seen a slight increase, trading just over $0.594, due to improved market confidence and a slight weakening of the US dollar. Investors feel more optimistic, moving away from last week's urgent rush to safer investments, fueled by expectations that the tensions between Iran and Israel won't escalate further.
Additionally, the Kiwi gained from a dip in the US dollar after recent figures indicated a decrease in US manufacturing and a slowdown in service sector growth, which could support lowering interest rates. In New Zealand, the Reserve Bank maintained the official cash rate at 5.5% for the month, stating that a tight monetary policy is necessary to bring inflation back within the target range of 1-3%.
The nation's annual inflation rate has dropped to 4% for the first quarter of 2024, marking the lowest rate since the second quarter of 2021.