Kiwi sets 1-year peak
On Thursday, the New Zealand dollar climbed to its highest value for more than a year after the Reserve Bank of New Zealand dropped interest rates as expected, thus disappointing some who had been betting on more aggressive easing.
The New Zealand dollar edged up to as high as $0.7351, the highest value since May 2015, before settling back to $0.7265 , up 1.1% from late American trade on Wednesday.
On Thursday, the Reserve Bank of New Zealand dropped interest rates a quarter point to a record minimum of 2% and also flagged the necessity for more dips as it struggles to head off deflation risks.
The kiwi headed north as there had been some speculation that it might dip interest rates by approximately 50 basis points as some financial analysts state.
Along with the Australian dollar, the New Zealand has found itself buoyed by the allure of its high bond yields.
By the way, New Zealand dollar 10-year government bonds boast a yield of approximately 2.1%, compared with negative yields in Germany and Japan.