New Zealand Dollar Hits Over 3-Week Low

The New Zealand dollar rose to around $0.596 on Thursday, after shedding 1.1% in the previous session.

The rebound was supported by the prospect of a de-escalation in trade tensions between the U.S. and China, as top officials from both countries will meet in Switzerland on Saturday to kickstart stalled trade talks.

Additional support came from China—New Zealand’s top trading partner—where authorities ramped up efforts to stimulate growth amid trade worries.

The Kiwi also benefited from a weaker U.S. dollar after the Federal Reserve held rates steady but warned of rising economic risks amid Trump’s chaotic trade war.

Domestically, however, expectations of more rate cuts from the Reserve Bank of New Zealand remains a headwind for the currency.

Markets imply about a 70% chance that the central bank will cut rates by 25bps later this month, with about three rate cuts anticipated by year-end.

The New Zealand dollar eased to around $0.599 on Wednesday, snapping a three-day winning streak, as investors digested mixed signals from domestic labor market data.

New Zealand’s unemployment rate held steady at 5.1% in the first quarter, but better than forecasts of 5.3%, while employment rose by 0.1%, matching estimates.

However, other details pointed to a weak job market, with wage growth slowing faster than expected.

Markets are still pricing in a 25bps rate cut by the Reserve Bank of New Zealand later this month, with about three rate cuts anticipated by year-end.

However, losses in the Kiwi dollar may be limited by optimism of a trade deal between the U.S. and China, as the two countries agreed to start negotiations.

Senior officials from both sides will meet in Switzerland later this week to kickstart stalled trade talks following President Donald Trump’s sweeping tariff rollout.

The New Zealand dollar rose to around $0.598 on Tuesday, advancing for the third consecutive session, supported by continued softness in the US dollar.

The greenback weakened amid uncertainty over trade developments and increased caution ahead of the Federal Reserve’s monetary policy decision.

However, gains in the Kiwi were partially capped by disappointing data from China’s services sector, which suggested that US tariffs are beginning to weigh on economic activity.

This added pressure to the antipodean currency, given China’s status as New Zealand’s largest trading partner.

Attention also turned to the upcoming domestic labor report, which is expected to show a rise in the unemployment rate—potentially reinforcing the case for further monetary easing by the Reserve Bank.

Markets have priced in a 75% chance of a 25-basis-point rate cut at the central bank’s meeting later in May, with a total of three additional cuts anticipated this year.

The New Zealand dollar held around $0.597 on Tuesday, halting a two-day gain, as the US dollar rose and private data indicated weaker Chinese PMI growth.

China’s services sector missed forecasts, expanding at its slowest pace since last September, showing signs that US tariffs are taking a toll.

This exerted pressure on the Kiwi, given China’s role as New Zealand’s largest trading partner.

Meanwhile, attention shifted to upcoming domestic unemployment data, which is expected to show a rise in the jobless rate—potentially strengthening the case for further policy easing by the Reserve Bank.

Markets have priced in a 75% chance of a 25-basis-point rate cut at the central bank’s meeting later this month, with a total of three more cuts expected this year.

The New Zealand dollar rose to around $0.598 on Monday, extending gains from the previous session, supported by continued US dollar weakness as investors awaited clearer signals on US-China trade relations.

On Sunday, President Trump reiterated his belief that China wants a deal, though he provided no details.

Meanwhile, Beijing signaled last week that it was open to talks but insisted the US first remove all unilateral tariffs.

Domestically, focus turned to upcoming unemployment data, expected to show a higher jobless rate, which could strengthen the case for further policy easing by the Reserve Bank.

Markets have fully priced in a 25 basis point rate cut at the central bank’s meeting later this month, with rates projected to bottom out at 2.75% by October.

The New Zealand dollar rose to around $0.592 on Friday, recovering after a three-day decline, as sentiments improved amid increasing signs of easing trade tensions reducing the risk of the export-heavy currency.

China signaled a willingness to initiate trade talks with the US, coming after President Trump’s comments suggesting potential trade agreements with India, Japan, and South Korea, he also stated that there was a high likelihood of a deal with China.

However, domestically, the New Zealand dollar remained under pressure amid growing expectations of further policy easing by the Reserve Bank of New Zealand.

Markets have fully priced in a 25 basis point rate cut at the central bank’s meeting later this month, with interest rates projected to bottom out at 2.75% by October.

For the week, the currency is heading for modest loss.