The NZD/USD pair gained 30+ points.
- by George Solotarov
The Reserve Bank of New Zealand announced that the base interest rate will remain at 1%. After this event, the NZD/USD rose to an intraday high. Also one of the factors reducing the risks is the optimistic mood regarding the current monetary policy of the US Federal Reserve Chairman Jerome Powell. On Tuesday he expressed his position while praising economic development.
Ten-year U.S. Treasury bonds are also showing stability. Their yield is kept at 1.60% as Japanese traders return to work after the holidays. Markets are preparing to meet with RBNZ governor Adrian Orr. He will share his quarterly forecasts and information on possible changes in the central bank rate. Some important information may hint at how the coronavirus will affect RBNZ's decisions in the future. Earlier, the NZD/USD pair benefited from the reduction of coronavirus risks and the decay of new infections in the Hubei area. Also, the Chinese government has injected cash into circulation, i.e. increased liquidity. In total, these factors had a significant impact on risk reduction.