AUROA: The New Zealand dollar extended its gains against its Australian counterpart after minutes of the Reserve Bank of Australia’s last policy meeting echoed comments by governor Glenn Stevens that interest rate cuts may be needed to foster sustainable growth.
The kiwi traded at 99.39 Australian cents as at 5pm in Wellington and earlier touched 99.44 cents, from 98.69 cents late yesterday. It reached 99.78 cents on April 6, the closest it has got to parity since being floated. The local currency slipped to 76.53 US cents from 77.01 cents yesterday.
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RBA policymakers deemed that further easing in policy “may be appropriate”, according to the minutes of the bank’s April meeting. They elected to keep the cash rate at 2.25 percent pending further data. Stevens told a meeting in New York overnight that “interest rates should be quite accommodative and the question of whether they should be reduced further has to be on the table.” Speculation about the timing of rate cuts has put added focus on first-quarter inflation data, due out tomorrow and expected to be weak.
