- The NZD/USD attracts strong tracking purchases for the fifth consecutive day in the middle of a bassist USD.
- The fears of recession in the US, the bets for feat cuts of the Fed and a positive tone of risk continue to weaken the dollar.
- Technical purchases above 200 -day SMA contribute to impulse despite commercial tensions.
The NZD/USD pair relies on the impulse of rupture of the previous day beyond the simple mobile average (SMA) of 200 days and gains a strong positive follow -up for the fifth consecutive day on Tuesday. The impulse raises cash prices to the region of 0.5925-0.5930, or a new maximum of the year to date during the Asian session, and is sponsored by the underlying bearish feeling that surrounds the US dollar (USD).
The USD (DXY) index, which tracks the value of the dollar against a foreign exchange basket, languishes about a minimum of three years amid concerns about the economic repercussions of the rapid escalation of the commercial war between the US and China. In fact, China increased its tariffs on US imports to 125% on Friday in retaliation for the decision of US President Donald Trump to increase tariffs on Chinese products to 145% unprecedented. Since the US still imports several difficult materials to replace China, development feeds the fears of recession and keeps the USD up to the defensive USD.
Meanwhile, the expectations that an economic deceleration driven by tariffs could force the Federal Reserve (FED) to cut interest rates more aggressively in 2025 turn out to be another factor that weighs on the dollar. In fact, the markets are currently valuing the possibility that the US Central Bank reduces the costs of loans in 90 basic points. In addition, the temporary suspension of Trump tariffs continues to support the positive tone of risk, which is also observed to weaken the dollar of safe shelter and directing flows to the kiwi, perceived as riskier.
Apart from this, the strong upward movement could also be attributed to some technical purchases above the very important 200 -day SMA. The operators now expect with interest the US economic agenda, which includes the publication of the Empire State Manufacturing Index, which, together with commercial developments, could influence the USD and provide some impetus to the NZD/USD torque. However, the approach remains focused on the speech of the president of the FED, Jerome Powell, on Wednesday, which will be examined in search of clues about the future path of feat cuts and that will boost the demand of the USD.
New Zealand Faqs dollar
The New Zealand dollar (NZD), also known as Kiwi, is a well -known currency among investors. Its value is largely determined by the health of the neozyous economy and the policy of the country’s central bank. However, there are some peculiarities that can also make the NZD move. The evolution of the Chinese economy tends to move Kiwi because China is the largest commercial partner in New Zealand. The bad news for the Chinese economy is probably translated into less neozyous exports to the country, which will affect the economy and, therefore, its currency. Another factor that moves the NZD is the prices of dairy products, since the dairy industry is the main export of New Zealand. The high prices of dairy products boost export income, contributing positively to the economy and, therefore, to the NZD.
The New Zealand Reserve Bank (RBNZ) aspires to reach and maintain an inflation rate between 1% and 3% in the medium term, with the aim of keeping it near the midpoint of 2%. To do this, the Bank sets an adequate level of interest rates. When inflation is too high, RBNZ rises interest rates to cool the economy, but the measure will also raise bond performance, increasing the attractiveness of investors to invest in the country and thus boosting the NZD. On the contrary, lower interest rates tend to weaken the NZD. The differential type of types, or how they are or is expected to be the types in New Zealand compared to those set by the Federal Reserve of the US, can also play a key role in the NZD/USD movement.
The publication of macroeconomic data in New Zealand is key to evaluating the status of the economy and can influence the valuation of the New Zealand dollar (NZD). A strong economy, based on high economic growth, low unemployment and high confidence is good for NZD. High economic growth attracts foreign investment and can encourage the New Zealand reserve bank to increase interest rates, if this economic strength is accompanied by high inflation. On the contrary, if the economic data is weak, the NZD is likely to depreciate.
The New Zealand dollar (NZD) tends to strengthen during periods of appetite for risk, or when investors perceive that the general market risks are low and are optimistic about growth. This usually translates into more favorable perspectives for raw materials and the so -called “raw material currencies”, such as Kiwi. On the contrary, the NZD tends to weaken in times of turbulence in markets or economic uncertainty, since investors tend to sell the most risky assets and flee the most stable shelters.
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.
