NZD/JPY soars to near 87.40 as RBNZ hikes its OCR by 75 bps – Crypto News – Crypto News
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NZD/JPY soars to near 87.40 as RBNZ hikes its OCR by 75 bps NZD/JPY soars to near 87.40 as RBNZ hikes its OCR by 75 bps

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NZD/JPY soars to near 87.40 as RBNZ hikes its OCR by 75 bps – Crypto News

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  • NZD/JPY has refreshed a two-week high at 87.40 as RBNZ has pushed interest rates to 4.25%.
  • The RBNZ has elevated its OCR by 75 bps after five consecutive 50 bps hikes.
  • Japanese markets are closed on account of Thanksgiving Day.

The NZD/JPY pair has displayed a firm vertical move to 87.40 after a bigger rate hike announcement by the Reserve Bank of New Zealand (RBNZ). The New Zealand central bank has ditched the 50 basis points (bps) structure after deploying it five times consecutively. RBNZ Governor Adrian Orr has pushed the Official Cash Rate (OCR) to 4.25%.

The decision has remained in line with the expectations as a battle against a historic surge in inflationary pressures demands an extremely restrictive monetary policy. The inflation rate for the third quarter was recorded at 7.2%.

It seems that the unavailability of significant exhaustion signals in the price growth has forced the central bank to play with big chips. However, a significant hike in the OCR has left less room for more rate hikes, which will shift more responsibilities on economic dynamics into play ahead. The catalyst which has also led to a significant jump in the cross is the consideration of a 100 bps rate hike by RBNZ policymakers. An ‘extremely-hawkish’ stance considered by the central bank has infused fresh blood into the Kiwi Dollar.

Meanwhile, rising Covid-19 infections in China are still a major concern ahead. Economic projections for the dragon economy have been hit hard. This could impact the Kiwi Dollar, being the leading trading partner of China.

On the Tokyo front, investors are awaiting the release of the PMI numbers, which will release on Thursday. The Jibun Bank Manufacturing PMI is seen as stable at 50.7. While the Services PMI is expected to decline marginally to 53.1. Investors should be aware that Japanese markets are closed on Wednesday on account of Thanksgiving Day.

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