New Zealand unexpectedly slashed interest rates to a record low on Thursday in a "shock and awe" tactic, stunning financial markets and sending the kiwi currency tumbling.
New Zealand's finance minister said Wednesday the country's multi-billion-dollar dairy industry faced a "serious or extreme" scenario as prices tumble, but downplayed the impact on the broader economy and refused help for farmers.
Big-spending tourists have helped the New Zealand economy grow faster than expected, with official figures Thursday showing gross domestic product accelerated 0.9 percent in the July-September quarter.
New Zealand dairy giant Fonterra announced a further 227 job losses Monday in a bid to remain competitive in "challenging market conditions," as global dairy prices plummet and mainland Chinese demand continues to wane.
As Chinese grew wealthier while their economy raced ahead, dairy farmers more than 6,000 miles away in verdant New Zealand felt like they'd won the lottery.
New Zealand snipped a further 0.25 percentage points off interest rates on Thursday, the third reduction this year, with the central bank suggesting further easing was likely in coming months.
New Zealand's largest coal miner was forced into a managed bankruptcy Thursday due to a steep fall in coal prices over several years.
New Zealand cut interest rates for the first time in more than four years on Thursday amid near-stagnant inflation and a slump in prices for its all-important dairy exports.
New Zealand confirmed Thursday it had failed to meet a pledge to deliver a budget surplus this year, although Finance Minister Bill English insisted the government's books were on the right track.
New Zealand's central bank left interest rates unchanged at 3.5 percent on Thursday and analysts said plans for further hikes appear to have been scrapped due to lower-than-expected inflation figures.