- A combination of support factors drives NZD/Usd up for the second consecutive day.
- A positive risk tone and the expectations of feat cuts of the Fed weakens the USD, offering support to the torque.
- The climb seems limited while the operators expect with interest the announcement of Trump’s reciprocal tariffs.
The NZD/USD wins a strong positive traction tracking for the second consecutive day and rises to a new weekly maximum, around the 0.5720-0.5725 region during Wednesday’s Asian session.
A generally positive tone around stock markets, together with the optimism about China’s economy, turns out to be key factors that benefit antipodal currencies, including the New Zealand dollar (NZD). The data published on Tuesday showed that China’s manufacturing activity expanded at its fastest rate in a year during March. This adds to the PMI officials of China better than expected on Monday and the recent stimulus measures to support economic recovery, which, together with the action of the moderate US dollar (USD), act as a tail wind for the NZD/USD torque.
Investors now seem convinced that a deceleration driven by US economic growth could force the Federal Reserve (Fed) to resume their cycle of feat cuts soon and are valuing the possibility of cutting cuts of 80 basic points by the end of this year. Apart from this, a stable performance around Asian stock markets fails to help Usd for sure refuge to attract significant buyers. That said, concerns about the announcement of reciprocal tariffs planned by the US president Donald Trump, on Wednesday, could stop the operators of making bullish bets around the NZD, which depends on exports.
In addition, the expectations that the New Zealand Reserve Bank (RBNZ) would reduce indebted costs at least twice by the end of the year could contribute to limit the NZD/USD torque. In addition to this, the breakdown of Monday below a one -week negotiation range justifies a certain caution before positioning for new profits. The operators now expect the publication of the US ADP report on employment in the private sector to obtain some impulse later during the early American session, although the approach will remain focused on the announcement of Trump reciprocal tariffs.
FAQS tariffs
Although tariffs and taxes generate government income to finance public goods and services, they have several distinctions. Tariffs are paid in advance in the entrance port, while taxes are paid at the time of purchase. Taxes are imposed on individual taxpayers and companies, while tariffs are paid by importers.
There are two schools of thought among economists regarding the use of tariffs. While some argue that tariffs are necessary to protect national industries and address commercial imbalances, others see them as a harmful tool that could potentially increase long -term prices and bring to a harmful commercial war by promoting reciprocal tariffs.
During the election campaign for the presidential elections of November 2024, Donald Trump made it clear that he intends to use tariffs to support the US economy. In 2024, Mexico, China and Canada represented 42% of the total US imports in this period, Mexico stood out as the main exporter with 466.6 billion dollars, according to the US Census Office, therefore, Trump wants to focus on these three nations by imposing tariffs. It also plans to use the income generated through tariffs to reduce personal income taxes.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
