- The NZD/USD is strengthened while the Vice Prime Minister of China, Ding Xuexiang, announces plans for more proactive macroeconomic policies this year.
- The 25% tariff on President Trump’s cars generates fears of a broader commercial war, which could affect US economic growth.
- The US dollar fights while treasure yields decrease, with yields to 2 years and 10 years by 4.01% and 4.37%, respectively.
The NZD/USD is quoted around 0.5740 during Thursday’s European hours, recovering from losses in the previous session. The torque is gaining ground as the New Zealand dollar (NZD) is strengthened, possibly driven by the comments of the Vice Prime Minister of China, Ding Xuexiang, who declared that China will implement more proactive macroeconomic policies this year. Given the close commercial relationship between China and New Zealand, any economic change in China can significantly impact New Zealand markets.
The Deputy Prime Minister of China, Ding, also emphasized China’s commitment to promote private sector growth, addressing the concerns of foreign companies and encouraging foreign investment. These statements have provided an impulse to the feeling of risk, benefiting the NZD.
In addition, the US dollar (USD) is going back after the US president Donald Trump announced a 25% tariff on imported cars and light trucks, which will enter into force on April 2. This movement, together with other planned reciprocal tariffs, has generated concerns about a broader commercial war that could affect economic growth.
The American dollar index (DXY), which measures the US dollar (USD) compared to six main currencies, is going back from recent profits and is quoted around 104.40. The dollar faces additional pressure as US treasure yields decrease, with yields to 2 years and 10 years by 4.01% and 4.37%, respectively.
Market participants are now waiting for key economic data from the US scheduled for publication later today, including the initial weekly orders of unemployment subsidy and the final annualized report of the GDP of the fourth quarter. In addition, Friday’s report on personal consumption expenses (PCE), the preferred inflation measure of the Federal Reserve, will offer more information about the policy perspective of the Central Bank.
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 New Zealand economy and the policy of the Central Bank of the country. 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.
