* New Zealand c. bank holds rates steady, wrongfoots investors. * Hedge funds had built up massive short bets against the Kiwi dollar. * Dollar firms on risk-off sentiment; Powell testimony eyed. * Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh.
The New Zealand dollar surged Wednesday after the country's central bank defied expectations for an interest rate cut, and left policy unchanged. The kiwi dollar jumped 1.1% to 0.6402 U.S. cents. In a statement, the Reserve Bank of New Zealand said at it was leaving the Official Cash Rate at 1% as economic developments since August "do not warrant a change to the already stimulatory monetary policy setting at this time."
* Kiwi soars after RBNZ dashes rate-cut expectations. * Dollar steady elsewhere near multi-week highs. * Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh. By Tom Westbrook. The New Zealand dollar soared 1% on Wednesday after the country's central bank unexpectedly left interest rates on hold, while most other currencies trod water. "It's flying.
SYDNEY--New Zealand's central bank kept its official cash rate unchanged Wednesday, as it sought to balance the need to revive inflation against recent signs of stabilization in the domestic and global economies. The decision by the Reserve Bank of New Zealand to keep its official cash rate at 1% was at odds with the majority of economists, who had predicted a quarter-percentage point cut. "The Committee debated the costs and benefits of keeping the official cash rate at 1.0%...
The Reserve Bank of New Zealand held the official cash rate at 1.0% on Wednesday, dashing market expectations for an easing, but said it remained prepared to act on policy as required. "We expect economic growth to remain subdued over the remainder of the calendar year. A Reuters poll of economists had expected RBNZ to cut rates in the final policy meeting for the year.
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