Kiwi Weakens on RBNZ’s Accommodative Outlook

2026-02-18 01:40 By Kyrie Dichosa 1 min. read

The New Zealand dollar weakened to around $0.601 after the Reserve Bank held key interest rates and signaled that policy would remain accommodative.

The central bank indicated that monetary policy is likely to stay supportive in the near term, with adjustments coming gradually as the recovery strengthens and inflation moves sustainably toward the target midpoint.

However, current forecasts suggest the possibility of a quarter-point hike later this year if conditions warrant, revised from previous guidance that had pointed to mid-2027 for a potential rate increase.

Still, officials remain cautious about the timing of any stimulus withdrawal.

Traders pared expectations for RBNZ rate hikes, with markets pricing in roughly about 75% of a hike by October shortly after the decision, down from 90% prior.

Nevertheless, some economists anticipate tightening as early as September.

Markets are now focused on Governor Anna Breman’s press conference later today for further policy guidance.



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