2019.11.1305:46:00UTC+00NZ Dollar Spikes Up After RBNZ Holds Rate Steady Unexpectedly

The New Zealand dollar advanced against its major counterparts in the Asian session on Wednesday, after New Zealand's central bank left the key interest rate unchanged, defying expectations for a reduction.

The Monetary Policy Committee of the Reserve Bank of New Zealand, led by Governor Adrian Orr, decided to keep the Official Cash Rate at 1.0 percent. Economists had expected a quarter-point reduction to 0.75 percent.

"Economic developments since the August statement do not warrant a change to the already stimulatory monetary setting at this time," according to the accompanying statement.

In its statement, the central bank said that it is prepared to add further monetary stimulus if needed.

"Interest rates will need to remain at low levels for a prolonged period to ensure inflation reaches the mid-point of our target range and employment remains around its maximum sustainable level," it added.

The kiwi appreciated to an 8-day high of 69.90 against the yen, from near a 4-week low of 68.92 seen at 7:30 pm ET. If the kiwi continues its rise, 71.5 is possibly seen as its next resistance level.

The kiwi strengthened to an 8-day high of 0.6416 against the greenback, after falling to 0.6328 at 5:00 pm ET. Next key resistance for the kiwi is seen around the 0.66 level.

The NZ currency moved up to 1.7144 against the euro, its biggest since September 12. The kiwi is seen finding resistance around the 1.70 level.

The kiwi firmed to near a 3-week high of 1.0670 against the aussie, following a decline to 1.0806 at 5:15 pm ET. On the upside, 1.05 is possibly seen as the next resistance level for the kiwi.

Looking ahead, German final CPI for October is set for release at 2:00 am ET.

U.K. CPI and PPI for October and house price index for September, as well as Eurozone industrial production for the same month are due in the European session.

In the New York session, U.S. consumer price inflation and monthly budget statement for October will be featured.

At 11:00 am ET, Federal Reserve Chair Jerome Powell will testify on the economy before the Joint Economic Committee in Washington DC.