The New Zealand dollar posted its largest decline in more than a year on Monday after the Reserve Bank of New Zealand intervened the foreign exchange market by selling its currency in the thin trading session.
This is the first time the RBNZ intervened the market since it allowed the currency freely float in 1985. The kiwi hit a 22-year high against the dollar last week after a surprise rate hike by the central bank. The governor of the RBNZ, Alan Bollard, said that current level of the exchange rate was unjustifiably high in terms of economic fundamentals. The currency today tumbled 1.9% to 0.7495 versus the dollar, while fell 1.6% to 91.27 against the yen.
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