RBA Decision Sends NZ Dollar Soaring as NZX 50 Index Slips
The New Zealand dollar strengthened against its Australian counterpart after the Reserve Bank of Australia decided to maintain its cash rate at 4.35%, warning that it may increase rates if inflation rises further.
The RBA's decision led to a decline in the S&P/NZX 50 index, which slipped 27.58 points or 0.2% to 13,860.66. Energy-heavy stocks Mercury NZ and Meridian Energy were major contributors to this decline, falling 1.7% and 1.1%, respectively.
Contact Energy bucked the trend, rising 0.8% to $9.04 after Forsyth Barr analysts maintained their 'outperform' rating on the stock. The analysts cited the company's joint venture with Infratil as a credible path to maximize value from its Stratford site in Taranaki.
The kiwi dollar climbed to 83.59 Australian cents, while Australia's S&P/ASX 200 index rose 0.4% in late trading.