NEW YORK: The New Zealand dollar has fallen against Australian dollar after the Reserve Bank of Australia kept its key rate unchanged, while leaving open the possibility of a future cut.
THE kiwi fell to 96.32 Australian cents at 5pm in Wellington from 96.77 cents immediately before the announcement and 96.88 cents on Monday.
It gained to 75.33 US cents from 75.09 cents at 8am and 75.21 cents on Monday.
The RBA kept its cash rate at 2.25 per cent, saying economic growth seen as below-trend, and the Australian dollar was above fundamental value, particularly as commodity prices fall.
Governor Glenn Stevens said its cut last month meant a pause was needed, though “further easing of policy may be appropriate over the period ahead, in order to foster sustainable growth in demand and inflation consistent with target”.
“They’ve left the overhang of further interest rate cuts that could be possible in forthcoming meetings,” said Martin Rudings, senior dealer foreign exchange at OMF in Wellington.
“That just leaves it overhanging in the kiwi’s favour.”
The kiwi was unchanged at 67.29 euro cents at 5pm in Wellington from the same time on Monday and little changed at 90.19 yen from 90.12 yen.
The trade-weighted index was 78.32 at 5pm in Wellington from 78.36.
