The New Zealand dollar faced significant volatility following the RBNZ's policy announcement on Wednesday. The Reserve Bank of New Zealand (RBNZ) kept the interest rate at 5.50%, marking the eighth consecutive time it has maintained this rate.

Due to the economy's recessionary trend coupled with ongoing inflation risks, analysts had expected the RBNZ to decide to keep the interest rate unchanged. New Zealand's Consumer Price Index (CPI) increased by 4% in the first quarter.

Additionally, Statistics New Zealand indicated that the Gross Domestic Product (GDP) grew by 0.2% in the first quarter, which halted the technical recession after two consecutive quarters of GDP contraction.

Source: Fxstreet