The 3 reasons the RBNZ statement was bearish for the NZD

The Reserve Bank of New Zealand June 2018 monetary policy announcement and one-page statement was earlier

• RBNZ monetary policy decision, on hold as expected

Earlier responses are here:

• Responses to the RBNZ coming in ... risk next rate move is a cut
• Responses to RBNZ - banks shifting expectations of the next interest rate move ... later

This now via CBA:

While NZD has temporarily lifted … the statement is slightly bearish for NZD/USD for three reasons:

• (1) the RBNZ have acknowledged slightly more risks to the global economic outlook;
• (2) "the recent weaker GDP outturn implies marginally more spare capacity in the economy than we anticipated";
• and (3) "the Government's projected spending impulse is also slightly lower and later than anticipated"

NZD/USD wil struggle to lift while the USD exhibits trade-driven and monetary policy divergent driven strength.

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Last week CBA revised their forecasts lower for the currency:

• 0.6700 end-September forecast

CBA adds:

• The survey of firm's "own activity' which fell to its lowest level this year tends to have a better fit with New Zealand real GDP, and most notably with NZD/USD