The market bias for the NZD to EUR exchange rate is currently range-bound.
Key drivers include the interest rate differential, where expected rate cuts by the Reserve Bank of New Zealand may weaken the NZD, while the European Central Bank maintains a flexible policy, supporting the EUR. Additionally, the Eurozone's projected economic growth of 1.6% in 2026 adds stability to the EUR's outlook.
The NZD to EUR is likely to trade in a stable range over the next few months, influenced by recent price movements. It has hovered around 0.4927, remaining within a narrow 2.5% range from 0.4850 to 0.4973.
An upside risk to this outlook could arise from a stronger-than-expected recovery in global economic conditions, boosting demand for the NZD. Conversely, a downside risk is the potential for increased geopolitical tensions in Europe, which could weigh on the euro and shift market dynamics.