- NZD/USD reaches a new maximum of more than two weeks about 0.5700 amid the weakness of the US dollar.
- Market optimism in the middle of a delay in Trump’s reciprocal tariff plans has decreased the demand for safe refuge of the USD.
- The RBNZ is expected to cut its official cash rate (OCR) at 50 PBS up to 3.75% on Wednesday.
The NZD/USD pair reaches a new maximum of more than two weeks around 0.5700. The NZD is strengthened since the US dollar (USD) yields less than its peers in the middle of an optimistic environment in the markets. The demand for risk -sensitive assets has increased as the fears of immediate global commercial war fade.
On Thursday, the president of the United States (USA), Donald Trump, did not reveal a detailed plan for reciprocal tariffs and guided his team to work on it. However, market participants anticipated that reciprocal tariffs would be announced after Trump’s tweet in their social truth account that said “three great weeks, perhaps the best in history, but today is the big day: reciprocal tariffs! !!
An unexpected delay in Trump’s reciprocal plan decreased the attractiveness of Usd’s safe refuge. The American dollar index (DXY), which tracks the value of the dollar against six main currencies, reviews a minimum of almost four weeks around 106.80.
Meanwhile, investors expect the first monetary policy meeting of the Bank of the New Zealand Reserve (RBNZ), which is scheduled for Wednesday. Operators expect the RBNZ to continue relaxing monetary policy at a current rate of 50 basic points (PBS). Such scenario will be unfavorable for the New Zealand dollar (NZD).
The NZD/USD bounces strongly from the support zone drawn around 0.5500 in a weekly time frame. However, the PAR NZD’s perspective remains bassist since the 20 -week exponential mobile average (EMA) about 0.5777 is inclined down.
The 14-week relative force (RSI) index tries to return within the range of 40.00-60.00. A new bearish impulse would be triggered if the RSI fails to do it.
The NZD torque could fall near the round level supports of 0.5400 and 0.5300 if it breaks below the minimum of 13 years of 0.5470.
On the other hand, a decisive rupture above the maximum of November 29, 0.5930 could lead to the maximum of November 15, 0.5970 and the psychological resistance of 0.6000.
NZD/USD weekly graphics
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.
