New Zealand Dollar Higher As RBNZ Holds Rate Steady

The New Zealand dollar strengthened against its major counterparts in the Asian session on Wednesday, as New Zealand's central bank kept its key interest rate unchanged, saying that incoming information "did not warrant a significant change to the monetary policy outlook".

The Monetary Policy Committee of Reserve Bank of New Zealand headed by Adrian Orr decided to hold the Official Cash Rate at 1.0 percent.

The MPC observed that new information since August did not warrant a significant change to the monetary policy outlook.

The MPC assessed that employment was around its maximum sustainable level, and inflation remained within the target range but below the 2 percent mid-point.

However, global trade and other political tensions remain elevated and continue to subdue the global growth outlook, dampening demand for New Zealand's goods and services.

The kiwi advanced to a 9-day high of 1.7327 against the euro from Tuesday's closing value of 1.7425. The next possible resistance for the kiwi is seen around the 1.71 level.

The kiwi that closed Tuesday's trading at 0.6324 against the greenback strengthened to a weekly high of 0.6348. If the kiwi rises further, it may find resistance around the 0.66 level.

The New Zealand currency appreciated to a 6-day high of 68.19 against the yen, off an early 2-day low of 67.58. The kiwi is seen finding resistance around the 71.5 mark.

Data from the Bank of Japan showed that producer prices in Japan were unchanged in August - in line with expectations following the upwardly revised 0.2 percent increase in July.

On a yearly basis, producer prices were up 0.6 percent - exceeding forecasts for 0.5 percent but unchanged from the July reading following an upward revision from 0.5 percent.

The kiwi spiked up to near a 2-week high of 1.0702 against the aussie from yesterday's closing value of 1.0753. The kiwi is poised to find resistance around the 1.05 level.

Looking ahead, U.K. mortgage approvals for August are due in the European session.

The U.S. new home sales for August will be featured in the New York session.