The New Zealand dollar fell across the board on 24 February as a quarterly RBNZ survey showed the market is bracing for declining inflation and easier monetary conditions.
The NZD/USD slipped to an eight-day low of 0.7463, down 0.85% from the previous close of 0.7527, and distancing further from the one-month high of 0.7575 touched on 18 February.
One and two-year-ahead expectations of annual consumers' price inflation have declined as per the survey. The one-year series decreased from 1.59% to 1.11% on a mean basis and the median fell to 1.0%.
The two-year-ahead inflation expectations decreased from 2.06% to 1.80%. The median remained at 2.0% but it compares to June 2014 rate of 2.36%.
"Monetary conditions are currently perceived as being easy. In the last survey conditions were expected to tighten, however this quarter respondents expect easy conditions to continue throughout the year," the RBNZ survey showed.
The EUR/NZD jumped to 1.5184 from the previous close of 1.5054 and the GBP/NZD rallied to an eight-day high of 2.0683 from the previous close of 2.0536 meaning a 0.7% decline in the kiwi dollar. The AUD/NZD rose to 1.0408 from Monday's (23 February) close of 1.0364.
The New Zealand-wide quarterly survey, conducted on 11-12 February, covers business managers and professionals.