New Zealand Dollar Drops After RBNZ Rate Hike

2026-09-02 02:26 By Judith Sib-at 1 min. read

The New Zealand dollar fell to around $0.583 on Wednesday, its lowest level in nearly five weeks, as the Reserve Bank of New Zealand delivered a second consecutive rate hike but signaled a more measured pace of further tightening than markets had anticipated.

The RBNZ raised the official cash rate by 25 basis points to 2.75%, as widely expected, stepping up efforts to curb inflationary pressures and reaffirming its commitment to returning inflation to its 1%-3% target range.

Its latest projections point to the policy rate reaching 2.81% by December and 3.15% by the end of 2027, below market expectations for a peak of around 3.5%.

Governor Anna Breman said the OCR trajectory is broadly consistent with the May forecast, while indicating that further rate increases are likely but the timing remains highly uncertain.

Swaps data showed that the probability of an October rate hike fell to around 36%, down from 65% before the meeting.



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New Zealand Dollar Drops After RBNZ Rate Hike
The New Zealand dollar fell to around $0.583 on Wednesday, its lowest level in nearly five weeks, as the Reserve Bank of New Zealand delivered a second consecutive rate hike but signaled a more measured pace of further tightening than markets had anticipated. The RBNZ raised the official cash rate by 25 basis points to 2.75%, as widely expected, stepping up efforts to curb inflationary pressures and reaffirming its commitment to returning inflation to its 1%-3% target range. Its latest projections point to the policy rate reaching 2.81% by December and 3.15% by the end of 2027, below market expectations for a peak of around 3.5%. Governor Anna Breman said the OCR trajectory is broadly consistent with the May forecast, while indicating that further rate increases are likely but the timing remains highly uncertain. Swaps data showed that the probability of an October rate hike fell to around 36%, down from 65% before the meeting.
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