Breaking: RBNZ hikes as expected 50bps

The Reserve Bank of New Zealand has hiked 50 bps as expected and the market is now digesting the statement, and the committee considered whether to increase by 50 or 75bps at this meeting, concluding that it is appropriate to continue hiking at the current pace. 

Ahead of the event, analysts at ANZ Bank argued that capacity pressures ''are only easing slowly and the labour market remains very tight. In this inflationary environment, we see the RBNZ has little choice but to focus on dampening inflation pressures by delivering another 50bp rate hike.''

More to come...

'' the analysts explained. 

As per the preview, When is the RBNZ and how might it affect NZD/USD?, the price was leaning over the top of a 100 pip box and resisted by the 0.5750s but is now bid on the relesde of the decision and statement.

It was stated that  ''the price could shoot up on a hawkish outcome towards a 50% mean reversion of the daily bearish impulse near 0.5800 and beyond.''

Also worth noting, the knee jerk to the RBA on Tuesday was a 50 pip sell-off before a 100 pip rally that was faded by the bears in London back to the post-RBA lows until the US dollar was sold off in New York. 

The kiwi is now testing the upside as follows: 

more to come...

About the RBNZ

RBNZ Interest Rate Decision is announced by the Reserve Bank of New Zealand. If the RBNZ is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive, or bullish, for the NZD.