The NZD/CAD currency pair traded in proximity to a fresh three-week high on Tuesday as investors awaited the outcome of the Reserve Bank of New Zealand’s and the Bank of Canada’s policy meetings tomorrow.
The Reserve Bank of New Zealand is largely expected to keep its official cash rate unchanged at 5.5% for a sixth consecutive meeting on Wednesday.
In February, the RBNZ toned down its hawkish stance, as it lowered its forecast cash rate peak to 5.6% from a prior forecast of 5.7%.
RBNZ Governor Adrian Orr said during a press conference following the policy decision that while committee members had discussed a rate hike, “there was very strong consensus that the official cash rate right now is sufficient.”
RBNZ policy makers noted they were aware that headline inflation remained above the target range of 1% to 3% and continued to expect interest rate cuts to begin in mid-2025.
Meanwhile, the Bank of Canada is also expected to leave its target for the overnight rate intact at 5% at its April meeting.
In March, the BoC said it would persist in its policy of quantitative tightening until it saw further and sustained easing in core inflation.
Currency Pair Performance
As of 6:45 GMT on Tuesday the NZD/CAD currency pair was edging up 0.23% to trade at 0.8196.
Earlier in the session, the minor Forex pair went up as high as 0.8211. The latter has been the pair’s strongest level since March 21st (0.8219).
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