The New Zealand dollar skidded on Thursday after the country's central bank surprised the market by committing to holding rates at record lows until the end of 2020 as economic growth figures disappointed. The New Zealand dollar sank as deep as $0.6665, the lowest since March 2016, breaking below critical support at $0.6688.
Against the Australian dollar, the kiwi dropped to a nine-month trough of NZ$1.1137. The falls came after the Reserve Bank of New Zealand (RBNZ) said it will keep rates at 1.75 percent through 2019 and into 2020. Across the Tasman Sea, the Australian dollar was a tad weaker at $0.7427 but not too far from a one-week high of $0.7440 set on Tuesday.
New Zealand government bonds gained, sending yields more than 9-11 basis points lower at the long end of the curve. Australian government bond futures rose, with the three-year bond contract and the 10-year contract up 2.5 ticks each at 97.910 and 97.345.