- NZD/USD is reporting gains above 0.6330 after RBNZ’s rate decision.
- The central bank kept rates unchanged as expected and said more stimulus could be provided if necessary.
The bid tone around the NZD strengthened, pushing the NZD/USD pair higher from the session low of 0.6304 to 0.6339 after the Reserve Bank of New Zealand (RBNZ) kept the overnight cash rate unchanged at 1.00% as expected.
The RBNZ said that the business confidence remains low and the interest rates can be expected to be low for a longer time. The central bank added that the domestic demand is expected to rise over the next year.
Further, it said that low overnight cash rate levels are needed to ensure inflation increases to the mid-point of the target range, and employment remains around its maximum sustainable level.
While the bank maintained that there is scope for more fiscal and monetary stimulus, if necessary, it refrained from explicitly signaling more rate cuts in the coming months. That seems to have put a bid under the NZD.
As of writing, the NZD/USD pair is trading at 0.6335, representing 0.10% gains on the day.
Looking ahead, the currency pair will likely extend gains, having confirmed a bullish inside bar reversal pattern on Tuesday.
Technical levels
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