I think many people can make a very solid argument that the RBNZ should not have tightened this time either, but after the strong tone from the last meeting they felt they were left with no choice.
Nevertheless, they have made up to some degree with the significant change in language and tone and there is little doubt now that they will stay on hold for quite a few months.
The NZD has fallen heavily but with interest rates still relatively high, and Chinese demand not slacking, this may be the dip that the NZD/USD bulls have been waiting for? Let’s have a closer look when the dust settles.
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