Market News
NZ central bank cuts rates to 3-year low, flags more easing; kiwi tumbles - REUTERS
Summary
- RBNZ cuts rates by 25 bps, signals more reductions
- Warns of global, domestic headwinds to growth
- Two of the RBNZ's six committee members voted for 50 bps cut
- NZ dlr and swaps tumble as markets surprised by dovish tone
WELLINGTON, Aug 20 (Reuters) - New Zealand's central bank cut its policy rate by 25 basis points to a three-year low of 3.00% on Wednesday, and flagged further reductions in coming months as policymakers warned of domestic and global headwinds to growth.
The central bank's dovish tone caught markets offguard and sent the New Zealand dollar tumbling 1.2% to a 4-month low at $0.5817, while two-year swap rates slumped as deep as 2.93% -- their lowest level since early 2022.
