The Kiwi Dollar Remains Firm despite Consumer Confidence

As with Australia, this morning, the Kiwi Dollar (NZD/USD) was trading on key economic news. The Kiwi dollar rose despite data showing that consumer confidence slipped. The July index n consumer confidence, from the lender Australia and New Zealand Bank (ANZ) and market research firm Roy Morgan fell by 1.9 percent monthly. This is down from June’s 3.1 percent gain. However, the ANZ report said that consumer confidence remains “at a high level overall.” This is despite easing this past month and, with a seasonal adjustment, consumer confidence remains at its highest level since 2014.

The consumer confidence data shows, according to ANZ, that spending is “healthy” even though house price expectations fell even further. Home prices even cooled off in sought-after Auckland. This will not make the Reserve Bank of New Zealand (RBNZ) unhappy. The central bank been concerned about property hotspots.

Kiwi Dollar Looks at the RBNZ

The RBNZ has, as of its last monetary policy statement, removed its neutral commentary. The RBNZ seems biased towards raising its record low official cash rate (OCR). The bank will eventually raise rates interest rates, even if it does not do so soon. This supported the Kiwi dollar this morning.

Yesterday’s news of a housing fund caused some NZD traders to fear a knock on inflation slide. This caused them to roll back some rate-hike bets and temporarily sell off the New Zealand dollar.