RBNZ changes : how will the NZD react?

RBNZ changes : how will the NZD react?

2019-11-11 • Updated

Some changes are coming in the Reserve Bank of New Zealand. Tomorrow a new Governor, Adrian Orr, will take the office. However, today he has already signed a new Policy Targets Agreement (PTA).

The new PTA differs from the previous ones with one important point. The bank will slightly shift its focus. The RBNZ will focus not only on price stability but also on full employment.

However, the CPI target remained unchanged in the range of 1-3% with a focus on the mid-point of 2% that is anticipated to be reached by 2021.

As the central bank is satisfied with the New Zealand economy, it seems that it plans to keep the interest rate on hold until 2019. So it will keep the kiwi under the pressure in the long-term.

How did the New Zealand dollar react?

Despite a disappointing forecast on the future rate hike, the New Zealand dollar met the announcement positively. The NZD/USD pair climbed to 0.7295 from the yesterday’s close price of 0.7231. The AUD/NZD rate fell further, reaching the lowest price since July 2017. GBP/NZD fell as well.  

Although the kiwi was not affected by the PTA announcement now, analysts of ANZ Research see difficulties for the New Zealand currency in the future. Although commodity prices are supporting the currency now, possible interest rate differentials with the US (that is anticipated to raise an interest rate at least 3 times this year) and decreasing global liquidity may cause a weakness of the kiwi. Moreover, any risk aversions will lead to NZD depreciation.

ANZ Research forecasts the plunge of the NZD/USD pair to 0.67. GBP/NZD is anticipated to rise to 2.12. All predictions are supposed to come to fruition until the end of 2018.


Adrian Orr, a new Governor of the RBNZ


OPEC Boosts The Oil Market
OPEC Boosts The Oil Market

Brent crude futures is maintaining stability this Friday, with traders awaiting an OPEC+ meeting that might lead to further supply cuts. Brent crude was down 8 cents at $81.34 a barrel, following a 0.7% drop in the previous session.

How Will China’s Regulation Affect Oil?
How Will China’s Regulation Affect Oil?

China has issued new oil product export quotas to allow oil companies to send surplus barrels overseas, particularly Sinopec, which has the highest volume among quota holders. While the exact quota volume remains undisclosed, oil companies are forecasted to export approximately 3.5 million metric tons of clean oil products in September, a 10% increase from August.

Latest news

Bitcoin 2024: The Story Is Cyclical
Bitcoin 2024: The Story Is Cyclical

In the dynamic world of financial trading, understanding the nuanced relationship between the Federal Reserve's key interest rates and Bitcoin can be a game-changer…

Will NFP Be Positive for the US Dollar?
Will NFP Be Positive for the US Dollar?

As the US Non-Farm Payrolls (NFP) take center stage, this month's data gains special attention, particularly after the unemployment rate took a concerning turn in the previous month. The US ADP Employment Change reveals a significant decline, with the economy adding 298K new jobs...

Deposit with your local payment systems

Data collection notice

FBS maintains a record of your data to run this website. By pressing the “Accept” button, you agree to our Privacy policy.


A manager will call you shortly.

Change number

Your request is accepted.

A manager will call you shortly.

Next callback request for this phone number
will be available in

If you have an urgent issue please contact us via
Live chat

Internal error. Please try again later

Don’t waste your time – keep track of how NFP affects the US dollar and profit!

You are using an older version of your browser.

Update it to the latest version or try another one for a safer, more comfortable and productive trading experience.

Safari Chrome Firefox Opera