- The New Zealand dollar shoots while retail sales and the weakness of the US dollar drive profits.
- Trump’s 50% tariff threat on EU imports adds to growth prospects for the US economy, feeding USD outputs.
- NZD/USD rises to 0.6000 while markets expect the speech of Fed Powell scheduled for Sunday.
The New Zealand dollar (NZD) has strengthened against the US dollar (USD) on Friday, driven by positive retail data and a weaker dollar.
At the time of writing, the NZD/USD is directed towards 0.6000, with intradic gains of 1.50% that result in a clear breakdown of the simple mobile average (SMA) of 20 days that provides support at 0.5928.
The Thursday publication of retail sales of the first quarter of New Zealand, which increased 0.8% in Q1, exceeded the estimates of analysts from an increase of 0.1%. The upward surprise reflected a stable growth of consumer spending, providing a positive change in the feeling of the NZD. In addition, the Treasury of New Zealand published its updated budgetary forecasts that showed expectations that the fiscal year 2025/2026 increases by 1.3%, below the previous provisions of 1.9%.
For the United States, the proposal of US President Donald Trump of a 50% tariff charge on imports of European Union assets (EU) resulted in an increase in USD’s departures, feeding the weakness of the US dollar.
As the speakers of the Federal Reserve (FED) maintained a Hawkish position, increasing the expectations that the Fed will maintain interest rates in the current range of 4.25% -4.50% in the next meetings of June and July, the economic perspectives for the US are still uncertain. While the Fed is expected to cut the rates in September, the president of the Fed, Jerome Powell, will offer his comments on Sunday, providing a possible vision of the expectations of rates in the middle of the current economic context.
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.
