Forex Today: RBNZ Hikes Rates by 0.50%

The RBNZ hikes rates and the risk-on rally sparked by last week’s lower than expected US inflation data continues.

  • Following yesterday’s first fall in annualized Canadian CPI data seen in a year, the risk-on rally continues with stock markets rising in much of the world. The S&P 500 Index and the NASDAQ 100 Index both rose yesterday to close at new 3-month highs. The Japanese Nikkei 225 Index is up by more than 1% today and very close to making a new high for 2022, while several European indices are making new 2-month highs. Asian markets have been boosted by hopes of more Chinese government monetary stimulus.
  • Canadian CPI (inflation) data released yesterday showed only a 0.1% month on month increase as expected, producing the first drop in the annualized rate seen in a year, to 7.6%. This gives analysts further hope that global inflation may have peaked.
  • The Reserve Bank of New Zealand has hiked its Official Cash Rate by 0.50% to 3.00%, which is the highest interest rate of any major currency.

  • The Forex market saw the US Dollar consolidate yesterday, and it is now beginning to sell off slowly. The Canadian Dollar and the British Pound look relatively strong.
  • There will be releases today of:
    • US FOMC Meeting Minutes
    • US Retail Sales data
    • Australian Unemployment data
  • Daily new coronavirus cases globally dropped last week for the fourth consecutive week.
  • It is estimated that 67.4% of the world’s population has received at least one dose of a coronavirus vaccination, while approximately 7.6% of the global population is confirmed to have contracted the virus at some time, although the true number is highly likely to be much larger.  
  • Total confirmed new coronavirus cases worldwide stand at over 597.1 million with an average case fatality rate of 1.08%.  
  • The rate of new coronavirus infections appears to now be most significantly increasing in Chile, South Korea, The Marshall Islands, Serbia, Trinidad, and Tonga.  
Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
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