The New Zealand Dollar remains supported as investors weigh a potential October rate hike against upcoming 3Q CPI data, which is expected to print at 3.8%.
The New Zealand Dollar is sensitive to upcoming 3Q CPI data, which is projected to decelerate to 3.8%. According to ING analyst Francesco Pesole, if the inflation figures exceed expectations, it would likely solidify market anticipation for an RBNZ rate hike in October, providing upward momentum for the currency.
The consensus expectation is for CPI to slow to 3.8%.
An upside surprise would reinforce expectations for an RBNZ rate hike in October, which is generally bullish for the NZD.
ING analyst Francesco Pesole projects New Zealand's third-quarter CPI will decelerate to 3.8%. This figure aligns with market consensus and sits slightly below RBNZ estimates, keeping the door open for a potential rate hike in October.
An upside surprise in the 3.8% CPI forecast would likely reinforce market expectations for an interest rate hike by the Reserve Bank of New Zealand in October.