Investing.com - The New Zealand and Australian dollars slipped lower against their U.S. counterpart on Thursday, after the Reserve Bank of New Zealand lowered interest rates unexpectedly and signaled the possibility for more cuts.
NZD/USD edged down 0.21% to 0.6638.
The kiwi weakened after the RBNZ lowered its benchmark interest rate to 2.25% from 2.50% at its monthly policy meeting. Analysts had expected the central bank to leave rates unchanged.
Commenting on the decision, RBNZ governor Graeme Wheeler said that China was one of the biggest risks to global growth.
"Any sharp slowing in Chinese growth could have significant implications for global growth, and for the Asia-Pacific region especially," he said.
The central bank also signaled the possiblity for further rate cuts to come, depending on New Zealand’s economic data.
"Whether we need another cut or whether we need more than another cut will very much depend on the data," Wheeler said.
AUD/USD fell 0.24% to trade at 0.7467, still close to the previous session’s eight-month high of 0.7527.
Meanwhile, investors remained cautious ahead of the European Central Bank’s highly anticipated policy decision due later in the day, amid expectations for additional easing measures to be announced.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.25% at 97.43.