Kiwi tries to rebound ahead of inflation data

New Zealand dollar rose in European trade on Tuesday against a basket of major rivals, amid attempts to recover from two-month lows against the greenback as risk appetite improves in the markets.

The gains come ahead of New Zealand inflation data for the fourth quarter of last year, which will showcase the level of inflationary pressures on policymakers. 

NZD/USD

NZD/USD rose 0.7% today to 0.6117, with November 27 lows at 0.6066, after losing 0.65% on Monday, the second loss in a row, amid concerns about China's economy, which is New Zealand's largest trade partner. 

Inflation Data

Consumer prices in New Zealand are expected to have risen 4.7% in the fourth quarter of last year, down from 5.6% in the third quarter. 

RBNZ

The Reserve Bank of New Zealand said after the November 29 meeting that interest rates must remain tight for an extended duration until consumer prices are brought under control.

In fact, the RBNZ doesn't expect any rate cuts until mid-2024, however, such prospects could change as economic data comes in.