Jun
10

Kiwi Falls to 5-Year Low as Central Bank Unexpectedly Cuts Rates

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The New Zealand dollar slumped to its lowest in almost five years after the nation’s central bank unexpectedly cut interest rates.

The kiwi declined versus all of its major peers as policy makers lowered borrowing costs for the first time since 2011 and said “further easing may be appropriate.” Low rates areneeded to address low inflationary pressures and weaker demand, Reserve Bank of New Zealand Governor Graeme Wheeler said Thursday in Wellington, after cutting rates 0.25 percentage point to 3.25 percent.

“Quite clearly, the economics justified a cut,” Sam Tuck, an Auckland-based senior currency strategist at ANZ Bank New Zealand Ltd., said by phone. “This is a prudent, insurance cut for the market. Hopefully the situation won’t decline further.”…

Kiwi Falls to 5-Year Low as Central Bank Unexpectedly Cuts Rates

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