NZD/USD under 0.8330 after RBNZ Governor Comments

The New Zealand dollar is lower late Friday after comments from the Reserve Bank of New Zealand Governor Graeme Wheeler weighed on the local currency throughout the session.

Mr. Wheeler said in a radio interview that new restrictions on house lending may mean the cash rate does not need to rise as much as previously thought, and that the central bank is prepared to intervene in the country’s currency under certain circumstances.  The central bank had on Oct. 1 introduced restrictions on lending to home buyers with small deposits.

However, RBC Capital Fixed Income and Currency Strategist Michael Turner said in a note that given Gov. Wheeler also said that now is not one of the circumstances when the bank would be prepared to intervene and comments on restrictions are not new. “It is hard to blame the weakness in the NZD purely on these comments,” he said.


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