The New Zealand interest rate is announced on Wednesday at 03:00 MT time.
New Zealand dollar rallies on less-dovish RBNZ
On Wednesday, the currency pair NZD/USD managed to go up in Asia following a Reserve Bank of New Zealand verdict earlier in the day.
New Zealand’s major financial institution left the interest rates on hold at 1.75%. However, it stayed away from providing any new dovish clues for either future monetary policy updates or headline economic indicators.
Adrian Orr, RBNZ Governor also underpinned the major bank’s outlook and told that the chances of a rate cut hadn’t soared, while risks are quite balanced.
The currency pair NZD/USD was last seen at 0.6845, heading north by 1.7% due to the fact that financial markets were set for a much more dovish RBNZ.
In addition to this, the USD index inched down by 0.1% being worth 96.453. More upbeat news on the trade front coming from the American side improved risk sentiment and diminished demand for safe-haven assets, in particular, the evergreen buck.
On Tuesday, US leader told that he’s geared up towards extending the March 1 deadline if China and America manage to get closer to a trade agreement soon. Earlier US Treasury Secretary Steven Mnuchin told reporters that he really hopes for fruitful trade talks in China.
Their remarks helped to recover risk appetite in broader markets. As a result, Asian stock kept soaring for a second day.
The dive in the evergreen buck also came as Fed Chair Jerome Powell played down the likelihood of a recession in his country, repeating that the American economy is on firm footing.
The Chinese Yuan also rallied versus its US rival reacting to the news. As a matter of fact, the currency pair USD/CNY tumbled by 0.3% being worth 6.7536.
The currency pair USD/JPY headed north by 0.1% concluding the trading session at 110.57.
The currency pair AUD/USD soared by 0.5% hitting 0.7130.
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.
Joe Biden is going to unveil a Covid-19 relief package of about $2 trillion. After this announcement, the 10-year Treasury yield rose, adding support for the USD.
The US dollar’s weakness offered a boost to emerging-market currencies and oil.