NZD/USD FALLS TO NEAR 0.6100 DUE TO WEAK BUSINESS NZ PSI, IMPROVED RISK AVERSION
- NZD/USD edges lower as Business NZ PSI drops to 40.2 in June, marking its fourth consecutive monthly decrease.
- Kelly Eckhold, Chief Economist at Westpac, anticipates that the RBNZ will begin easing policy in February 2025.
- The US Dollar improves due to improved risk aversion following the attempted assassination of former US President Trump on Saturday.
NZD/USD depreciates to near 0.6100 during the Asian session on Monday. This decline can be linked to the Business NZ Performance of Services Index (PSI), which dropped to 40.2 in June, marking its fourth consecutive monthly decrease and the lowest activity level for a month without a COVID lockdown. The previous reading was 42.6.
Kelly Eckhold, Chief Economist at Westpac, noted in this week's analysis and forecasts that the Reserve Bank of New Zealand's (RBNZ) growth projections have been notably downgraded. More importantly, the RBNZ appears increasingly confident that annual inflation will soon fall below 3%. Eckhold expects the RBNZ to start easing policy in February next year, though an earlier move is possible and will depend on incoming data
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