The New Zealand dollar weakened to around $0.63, sliding towards a two-year low hit in mid-June, as an increasing risk of a global recession due to aggressive monetary tightening dragged on commodity prices and related assets. Meanwhile, markets are betting that the Reserve Bank of New Zealand will more than double rates to 4.25% by year-end, suggesting a series of half-point rate increases at upcoming meetings. The RBNZ raised the official cash rate by 50 basis points to 2% in May, and said rates would need to rise “by more and sooner.” That was the second 50 bps rate increase in a row, following three 25 bps increases as the central bank acted in the face of decades-high inflation. New Zealand’s inflation rate reached 6.9% in the first quarter of 2022, much higher than the central bank target range of 1% to 3%.
Historically, the New Zealand Dollar reached an all time high of 1.49 in October of 1973. New Zealand Dollar - data, forecasts, historical chart - was last updated on June of 2022.
The New Zealand Dollar is expected to trade at 0.62 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 0.59 in 12 months time.