The New Zealand dollar dipped on Thursday as investors braced for a series of central bank meetings next week. The US has ordered diplomats to depart Saudi Arabia amid Houthi strikes.

New Zealand's annual inflation cooled to 3.7% in Q3, dropping below market expectations but still hovering above the central bank's maximum 3% target limit.

According to Statistics New Zealand, petrol prices remained the primary driver of inflation, despite a slight pullback from the previous quarter. The agency also highlighted a continued rise in residential construction costs.

The RBNZ held its last monetary policy meeting last month. The central bank projects inflation will successfully drop back within its 1% to 3% target band by the first half of 2027.

Markets have fully priced in a 50-bp interest rate increase by late February, alongside a near-certain 98% probability of a hike at next week's central bank meeting.

After a prolonged period of weakness, the economy has begun to show signs of resilience. The ruling party was elected three years ago on a pledge to revive growth, and the next election will hold in November.

EBC Financial Group analyst says the Kiwi is in a transition from bearish sentiment to market accumulation. It is hitting resistance near $0.5700, likely leading to a period of consolidation.

Asset Recap

As of market close on 21 October, among EBC major products, SpaceX shares led gains after earnings beat. Musk said he’s considering a combination with Tesla, adding to the risk sentiment.

Netflix shares hit a two-year low after Wall Street analysts lowered their target prices in response to weaker-than-expected fourth-quarter revenue guidance and full-year advertising projections.

Wall Street closed higher, led by the tech-heavy Nasdaq, as strong quarterly results from SpaceX boosted investor appetite for AI-related stocks. However, overall gains were limited by weakness in communication services.

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