MUFG Research discusses NZD outlook in light of this week's RBNZ 75 bps rate hike.
"The New Zealand dollar has been one of the best performing G10 currencies overnight following the RBNZ’s hawkish policy update as they delivered a larger 75bps rate hike. It has lifted the RBNZ’s policy rate up to 4.25% which is the highest rate amongst G10 central banks and boosted the carry appeal of the New Zealand dollar," MUFG notes.
"Even prior to today’s RBNZ policy update the NZD had been the best performing G10 currency over the past month as it has reversed YTD losses alongside the reversal in US dollar strength. The next key resistance level for the NZD/USD rate is provided by the 200-day moving average that comes in at just above the 0.7300-level," MUFG adds.