Bias: Range-bound, as the NZD is near the 90-day average and sits within the mid-range of the past three months.
Key drivers:
• Rate gap: The Reserve Bank of New Zealand's recent rate cuts contrast with the Central Bank of Solomon Islands' expansionary monetary policy, affecting the NZD's competitiveness.
• Risk/commodities: Current oil prices are driving concerns for New Zealand exports, putting further pressure on the NZD.
• Macro factor: Ongoing U.S. tariffs on New Zealand goods raise potential risks to the NZD's value through lower export revenues.
Range: Expect the NZD/SBD to hold steady within its recent range as external factors influence the currencies.
What could change it:
• Upside risk: A recovery in global market confidence could boost the NZD against the SBD.
• Downside risk: Continued trade tensions and economic uncertainties could lead to further weakness in the NZD.