The New Zealand dollar continued to lose against other currencies today (except the U.S. dollar) as the economy contracted in the first quarter and the expectations that the central bank will cut the interest rate rose.
Although, the New Zealand currency is rising today against the U.S. dollar, it’s still going down sharply against the yen, euro, and Australian dollars. It will probably end the week in the negative zone against those three currencies.
The gross domestic product fell 0.3 percent in the first quarter of 2008 in New Zealand showing that the 8.25 percent interest rate is pressing hard on the country’s economy. Output contraction may play a significant role at the next Reserve Bank of New Zealand monetary policy meeting.
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