- The NZD/USD loses ground as the Westpac consumption survey indicates a weakening of consumer confidence in New Zealand.
- Westpac New Zealand reported a fall in its trusted index, which went to 89.2 in the first quarter from 97.5 in the previous quarter.
- The US dollar remains firm while operators adopt caution before the decision on the interest rates of the Fed scheduled for Wednesday.
The NZD/USD remains subdued for the second consecutive day, around 0.5810 during the Asian session on Wednesday. The PAR faces down pressure after the publication of the Westpac consumption survey of the first 2025 New Zealand quarter, which indicated a weakening of consumer confidence.
Westpac New Zealand reported that its trust index fell to 89.2 in the first quarter from 97.5 in the previous period, the lowest level since the second quarter of 2024. The fall reflects the increase in commercial tensions, the persistent pressure on the cost of living and volatility in financial markets.
However, the NZD/USD torque could find support in market optimism before publication of New Zealand quarterly GDP data on Thursday. Analysts expect a modest rebound of 0.4% in the fourth quarter, after two consecutive contraction quarters.
Meanwhile, the US dollar (USD) remains firm, backed by stable yields of treasure bonds while investors await the decision on the interest rates of the Federal Reserve (Fed) later in the day. Markets widely anticipate that Fed will maintain stable rates amid persistent concerns about inflation and economic uncertainty.
The dollar (DXY) index operates about 103.30, while the yields of 2 and 10 years of treasure are located at 4.04% and 4.29%, respectively. However, the dollar faces pressure for weak economic data from the US and new tariff threats of President Donald Trump, adding uncertainty to the market.
The operators are closely monitoring the updated economic projections of the Fed to obtain information on the future path of interest rates in the US. Any hard line signal could further strengthen USD against its counterparts.
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.
