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New Zealand central bank surprises by reducing stimulus

Kiwi dollar jumps after RBNZ halts pandemic bond-buying program

The Reserve Bank of New Zealand announced a halt to its pandemic-induced NZ$100 billion bond purchase program on July 14.   © Reuters

WELLINGTON (Reuters) -- New Zealand's central bank on Wednesday announced a halt to its pandemic-induced NZ$100 billion ($70 billion) bond purchase program, sending the Kiwi dollar soaring as markets took it as sign that a rate hike was not far away.

The Reserve Bank of New Zealand (RBNZ) kept its official cash rate at 0.25%, as widely expected, but local banks brought forward their calls for a rate rise to as early as August, which would put New Zealand at the forefront of countries to raise interest rates.

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