Kiwi Stabilises as Rate Hike Expectations Rise

The New Zealand dollar steadied around 0.602 in early Asian trading after recovering from a two-week low of 0.593, signalling resilience despite mixed domestic data. While the unemployment rate climbed to a decade high of 4.4%, employment growth surprised to the upside, complicating the Reserve Bank of New Zealand’s policy outlook.

Traders are increasingly focused on inflation and growth dynamics rather than labour market softness alone. With inflation still above the RBNZ’s target range and signs of economic recovery emerging, market pricing has shifted. Swaps now reflect a roughly 70% probability of a rate hike by September 2026, well ahead of the central bank’s own guidance pointing to mid-2027.

Read more on how shifting rate expectations and technical levels are shaping the Kiwi’s next move.