New Zealand's economic data pushes kiwi toward resistance level

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New Zealand's economic data pushes kiwi toward resistance level

Bloomberg - - New Zealand s better-than-expected economic data has seen traders ratchet up odds of an interest-rate hike next month and also propelled the kiwi toward a key resistance level.

The probability of a 50 basis-point hike by the Reserve Bank of New Zealand at its October meeting rose to 44% after the numbers were published, from just 16% on Wednesday according to overnight index swaps. In the second quarter, government data accelerated to 2.8%, against the median estimate by economists of 1.1%.

Swaps traders have also increased expectations for hikes in November. A move of 50 basis points is fully priced in by then with a further 60% probability of an additional 25 basis points, as compared with less than 20% odds on Wednesday. The central bank has held its official cash rate at a record low 0.25% since March 2020.

The Australian dollar also rallied after the figures were released, climbing as much as 0.5% to 71.38 U.S. cents.