Outlook
The NZD remains underpinned by a risk-on mood, with upside potential if market sentiment stays upbeat. Markets price in a potential 50bp cut by the RBNZ at the next meeting, which could cap gains, while high dairy prices support New Zealand’s export income and terms of trade.
Key drivers
- Risk-on mood supports NZD; a sustained upbeat environment could see further gains.
- RBNZ policy expectations, with markets pricing in a 50bp rate cut at the next meeting.
- US tariff actions that boosted NZ exports (e.g., dairy and other foods) reinforce supportive trade dynamics.
- Ongoing US–China trade tensions add volatility to global FX and risk sentiment.
- Elevated dairy prices bolster export income and the terms of trade for New Zealand.
Range
NZDUSD is near 0.6055 at 7-day highs, about 4.3% above its 3-month average of 0.5805, having traded in an 0.5590 to 0.6077 range.
NZDEUR around 0.5085, about 2.5% above its 3-month average of 0.4959, with a 0.4850 to 0.5122 range.
NZDGBP around 0.4425, about 2.3% above its 3-month average of 0.4327, trading in a 0.4268 to 0.4425 range.
NZDJPY around 94.52, about 4.2% above its 3-month average of 90.71, within a 87.18 to 94.79 range.
What could change it
- Shifts in global risk appetite (sudden risk-on or risk-off shifts).
- Unexpected RBNZ policy moves or new guidance beyond the priced-in 50bp cut.
- Dairy price swings or changes in New Zealand’s export volumes affecting the terms of trade.
- Developments in US–China trade relations or new tariffs impacting global demand.
- Movements in USD strength or broad rate expectations that affect cross‑currency dynamics.
