The Central Bank cut the rate by 175 basis points in August in an attempt to support the ailing economy and maintain job growth. After the adoption of the decision, the course of the New Zealand dollar decreased by 0.3% to $0.5687, while the central bank commented on the likelihood of further cuts. Most economists surveyed by Reuters this month expect another cut of 50 basis points in April.
Ukrainian President Volodymyr Zelensky stated that a global agreement cannot be reached behind his back. "The euro area is likely to sharpens due to apparent disagreements between the US and Europe regarding the war in Ukraine," noted Sean Kelly, a leading FX analyst at InTouch Capital Markets.
The dollar strengthened on Tuesday, supported by the weakness of the euro, but remains close to a two-month minimum of 106.56, reached on Friday, despite additional promises to introduce shifts. Trump confirmed the intention to introduce automobile tariffs "around 25%" and similar shifts on imported pollutants and pharmaceutical products.
"Investors are awaiting the release of the Federal Reserve's January meeting minutes later in the day for clues on how policymakers are weighing the risk of a global trade war," noted Sean Kelly. The dollar index, measuring the dollar against a basket of competitors, rose by 0.04% to 107.04. The yen strengthened by 0.05% to 152 per dollar, supported by the data released by the Bank of Japan for October-December.
Expectations of an increase in rates at the Bank of Japan's July meeting are ramping up, but questions remain about the pace and scale of tightening. Inflation data from the UK is expected to be average, following yesterday's data on the accelerating growth of wage earnings. The Australian dollar decreased by 0.07% to $0.63495, after data showed that the increase in domestic wages in the fourth quarter grew with the highest annual rate in more than two years.
Funds markets are assessing the latest developments in the trade policy of US President Donald Trump and the uncertainty after negotiations over a ceasefire between Russia and Ukraine, which were completed without the participation of Kyiv or Europe at the table.
