The NZD to USD exchange rate is currently range-bound.
Key drivers include:
- The Reserve Bank of New Zealand (RBNZ) is expected to cut interest rates, which may support the NZD in the near term.
- Recent upbeat GDP figures in New Zealand have not significantly altered RBNZ policy expectations, contributing to the NZD's subdued performance.
- The US economy is anticipated to weaken, with the Federal Reserve expected to implement rate cuts, potentially leading to a softer USD.
In the near term, the NZD/USD is likely to trade within a stable range, following its recent performance just above the three-month average.
An upside risk for the NZD could come from stronger trade figures in New Zealand, while a downside risk may emerge from continued global economic uncertainty impacting demand for the currency.