NZD/USD at 0.8630 on hawkish RBNZ

The New Zealand dollar rallied on Thursday after the country’s central bank lifted interest rates and signaled more hikes ahead, while caution ahead of a speech by the European Central Bank kept the euro subdued.

The kiwi climbed more than a third of a U.S. cent to a high of $0.8626 after the Reserve Bank of New Zealand (RBNZ) said it would continue to tighten to stay on top of inflationary pressures. As expected, it hiked its cash rate to 3.0 percent from 2.75 percent.

Some in the market had thought it might signal a slowing in the pace of further rate hikes given a stubbornly strong currency and still moderate inflation.


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