What it is
The currency of New Zealand, a small, open economy that exports dairy products, meat, fruit, timber and wine. It is a smaller market than the other major currencies.
Who issues it
The Reserve Bank of New Zealand issues the New Zealand dollar and sets the Official Cash Rate through its Monetary Policy Committee.
How it is commonly described
- Commodity-linked
- Issued by an economy whose exports are led by raw materials, so it is often read beside their prices.
- Risk-sensitive
- Commonly rises when investors are confident and falls when they are cautious.
Farm produce leads New Zealand’s exports, so the currency is often read beside the prices of dairy products in particular. As a smaller market it tends to respond more than the larger currencies to the mood of world markets.
These are descriptions people use, drawn from how the currency has commonly behaved. They are not promises about how it will behave.
What typically moves it
- Prices of dairy products and other farm exports
- Reserve Bank of New Zealand policy, and the gap between New Zealand and US interest rates
- Demand from China and Australia, two of its main trading partners
- Risk appetite in world markets
These are the things people who follow this currency usually watch. They explain how the market works; they do not say what the exchange rate will do next.
The scheduled releases to know
- Official Cash Rate decision and the Monetary Policy StatementPublished by Reserve Bank of New ZealandExplainer: Rates
- Consumers Price IndexPublished by Stats NZExplainer: CPI
- Labour market statisticsPublished by Stats NZExplainer: Jobless rate
- Gross Domestic ProductPublished by Stats NZExplainer: GDP
- Global Dairy Trade auction resultsPublished by Global Dairy Trade
No dates or figures are shown here: each publisher’s own calendar is the authority. The explainers are in Economic Events; a release without a link has no explainer on this site yet.
Its main session
Sydney. Wellington is the first financial centre to open each day, and the trading week begins there on Monday morning. New Zealand data arrive before Sydney and Tokyo are fully open, when the market can be thin.
At GIO4X
GIO4X lists one currency pair that contains the New Zealand dollar. Each pair’s contract and published conditions are on its instrument page, where they are labelled as indicative. They are not repeated here.
A short history
The New Zealand dollar replaced the New Zealand pound on 10 July 1967, when the country moved to decimal currency. It was floated in March 1985. The Reserve Bank of New Zealand Act of 1989 made price stability the bank’s task, and New Zealand became the first country to adopt a formal inflation target, an approach many central banks have followed since.
Words worth knowing
A reference page. Educational information, not investment advice or a recommendation to trade. It gives no exchange rate, no interest rate and no forecast.