- The New Zealand dollar descends while the US dollar experiences a rebound.
- The US dollar increases with the confidence of the optimistic consumer, attending the profits.
- The NZD/USD falls towards the technical support, remaining firm at the midpoint of the fall from September to April.
The New Zealand dollar (NZD) is losing ground against the US dollar (USD) on Tuesday, going back after a failed attempt to exceed the key level of 0.6000.
The setback occurs as concerns about commercial tensions between the US and the EU decreases and the mood of the market in general becomes more stable, allowing the US dollar to recover some of the losses of last week.
At the time of writing, the NZD/USD torque is quoted about 0.5945 after finding resistance in the psychologically significant 0.6000 brand and fails to generate impulse beyond it.
With the US markets back after the Fallen Day holiday, the USD is finding new support. A stronger consumer trust reading has helped boost the rebound. The index sharply rose to 98 in May, from 85.7 in April, reflecting a notable increase in optimism among US consumers.
The data highlights the growing confidence in economic perspectives despite persistent global uncertainties.
That rejected has caused a setback to the midpoint of the fall from September to April.
The NZD/USD is withdrawn with the RBNZ rates decision, FAR Minutas ahead
For the Kiwi, Wednesday’s economic agenda remains a key focal point for investors as the markets prepare for the decision of interest rates of the New Zealand Reserve Bank (RBNZ), scheduled for 02:00 GMT.
Market participants anticipate that the Central Bank will announce a rate of 25 basic points (0.25%). This movement would reduce the reference rate to 3.25%, from its current level of 3.50%.
Although the reduction has already been incorporated into the NZD/USD exchange rate, the fans that accompanies it could help induce volatility.
With the report by providing information on the reason behind the last announcement and projected economic perspectives, any hard or moderate line comment could result in a readjustment of expectations about the trajectory of interest rates.
For the United States, the Federal Open Market Committee (FOMC) will publish the minutes of its May 6-7 meeting, when policy managers decided to maintain the interest rate without changes. The minutes are expected to reveal clues about the hard line posture of the Fed and could help guide the expectations about the time of the next rate cut, currently scheduled for September.
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.
