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NZD/USD Remains Close to Five-Month Highs Due to US Trade Policy Uncertainty and RBNZ Easing Hopes

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  • April 18, 2025
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The NZD/USD currency pair continues near its five-month highs, trading around 0.5970, as investors pay close attention to US trade policy developments, especially given New Zealand’s substantial export relations with China. In spite of a recent surge, the New Zealand Dollar is rangebound due to anticipation of additional monetary easing by the Reserve Bank of New Zealand (RBNZ), which is expected to reduce rates in May. US trade tensions and the fear of the economic effects of tariffs on China have seen a weakening US Dollar, driving the NZD higher. At the same time, US economic indicators revealed a drop in initial jobless claims, but an increase in continuing claims, further affecting market sentiment. KEY LOOKOUTS • Any change in US trade policy, particularly with regards to tariffs on China, could have a major impact on the NZD/USD pair. With New Zealand having a strong export relationship with China, any increase or decrease in trade tensions will be closely monitored. • Hopes of further monetary easing from the RBNZ, potentially in the form of a May rate cut, may bear down on the New Zealand Dollar. Traders will monitor any official commentary or economic releases that signal the central bank’s next action. • Ongoing economic metrics, specifically labor market indicators such as jobless claims, will give indications of the strength of the US economy. A softer-than-anticipated US economy might add extra pressure on the US Dollar and give extra room for NZD upside. • In light of prevailing market volatilities, any shift in global risk sentiment, for example, fears surrounding the economic impacts of US tariffs or geopolitical pressures, may impact investor demand for riskier currencies such as the NZD. NZD/USD pair remains close to five-month highs at about 0.5970 as investors continue to watch events regarding US trade policy and their potential implications on New Zealand’s economy. The attention of the market is centered around US-China trade tensions, considering that New Zealand has a huge export relationship with China. The New Zealand Dollar is also under pressure due to anticipation of further easing by the Reserve Bank of New Zealand (RBNZ) and an anticipated rate cut in May. The US Dollar has been on the back foot with worries regarding the economic impact of tariffs and recent US labor market statistics, indicating a reduction in initial jobless claims but an upsurge in continuing claims, contributing to the uncertainty. As volume has been sparse to date given the Good Friday holiday, NZD/USD will likely realize higher levels should the US Dollar soften further but there is a great deal hanging on the further progression of trade policy and the unfolding of economic fundamentals in the days ahead. The NZD/USD currency pair continues to trade close to its five-month highs around 0.5970 as concerns over US trade policy rise and anticipation of further monetary relaxation by the Reserve Bank of New Zealand grows. The New Zealand Dollar is bolstered by a weaker US Dollar as trade tensions and economic indicators continue to affect market sentiment. • The NZD/USD currency pair is trading close to its five-month high, at 0.5970, following seven consecutive days of increases. • Market participants are keenly observing US trade policy news, especially with regards to China, since New Zealand’s economy is greatly dependent on exports to China. • US-China trade tensions may impact the NZD/USD pair, particularly following US President Trump’s statement regarding the possibility of not imposing additional higher tariffs on China. •  Recent US economic statistics, such as a fall in initial jobless claims and a rise in continuing claims, are influencing market sentiment and supporting a weaker USD. • The Reserve Bank of New Zealand (RBNZ) is likely to further ease monetary policy, with markets already pricing in a rate cut in May, which may pressure the NZD. • The US Dollar has weakened on fears over the economic consequences of tariffs, offering a chance for the NZD to firm up. • Volumes in trading are bound to be light because of the Good Friday holiday, which might result in lesser market volatility in the short term. NZD/USD currency pair is trading around its five-month highs as of now, indicating a spell of relative stability in spite of continued global uncertainty. Investors are especially interested in the evolution of US trade policy, with keen interest in the possible effects of trade relations between the US and China, in light of New Zealand’s high export connections with its biggest trading partner. While the New Zealand Dollar has been able to remain robust, much of its movement is influenced by external forces, including changes in US economic strategy and general market sentiment. NZD/USD DAILY PRICE CHART CHART SOURCE: TradingView Concurrently, sentiment around the monetary policy moves by the Reserve Bank of New Zealand is shaping the outlook for the New Zealand Dollar. With inflation remaining within the target band for the central bank, there is speculation that more easing measures might be in store. This interplay, together with a normally subdued trading session on account of the Good Friday holiday, indicates that while there is conservative optimism surrounding the NZD, its future directions will be greatly dependent on both global trade evolution and domestic economic choices. TECHNICAL ANALYSIS NZD/USD pair is testing resistance around the five-month high of 0.5979, and it looks promising to see further potential for upside if the price can continue above this point. The pair has been exhibiting steady upward motion during the last week, with gains for seven straight days, which may be a sign of a bullish trend. Yet, as the pair lingers around crucial resistance, the traders will keenly observe for a breakout or a pullback. Support levels at 0.5900 may serve as a cushion on a reversal, while any change in market mood, especially in relation to US trade policy or the Reserve Bank of New Zealand’s policy direction, may drive the pair in the short term. FORECAST NZD/USD pair may experience additional upside if the US

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AUD/USD Currencies

Australian Dollar Remains Steady Despite Budget Release and Global Economic Unrest

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  • March 25, 2025
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The Australian Dollar stabilised after Treasurer Jim Chalmers’ release of the 2025/26 budget, which outlined anticipated deficits of A$27.6 billion in 2024-25 and A$42.1 billion in 2025-26, in addition to tax cuts to spur economic stimulus. The Reserve Bank of Australia’s restraint regarding interest rates and anticipation of Chinese stimulus both lent further support to the AUD. Nonetheless, cross-border uncertainties, such as President Trump’s US trade policies and inconsistent US economic statistics, remain possible threats. In the meantime, technical markers indicate the AUD/USD exchange rate is under stress, trending below significant levels of resistance within continuing market turmoil. KEY LOOKOUTS • The tax cuts and economic projections of the Australian government can shape investor optimism and market stability. • The Reserve Bank of Australia’s conservative approach to rate cutting and its reaction to inflation and international economic trends will be pivotal for the movement of the AUD. • Any possible tariff announcements by President Trump and how these will affect global trade, specifically Australia’s trading relationship with China and the US, may cause volatility. •The currency pair is still below major resistance at 0.6300, with support at 0.6220; a break above or below these levels may indicate the direction of the next market move. The Australian Dollar’s stability after the 2025/26 budget announcement is indicative of cautious optimism, but major factors may determine its path in the weeks ahead. The Reserve Bank of Australia’s interest rate stance continues to be a major focus, as investors weigh the chances of further policy changes. At the same time, worldwide trade tensions, especially possible US tariff announcements, may also weigh on market sentiment and the economic prospects of Australia. Of course, technical levels of resistance around 0.6300 and support at 0.6220 will also be observed closely, as a break through in either direction may indicate the next significant move for the AUD/USD pair. The Australian Dollar is stable following the budget announcement for 2025/26, with investors waiting for tax reductions and economic projections. RBA’s interest rate policy and possible US tariff implications may influence market sentiment. Technical resistance of 0.6300 and support of 0.6220 will be points of interest for AUD/USD action. • The budget for 2025/26 involves tax reductions and economic projections, with a budget deficit of A$42.1 billion for 2025-26. • The Aussie remains firm, helped by RBA holding rates and possible Chinese stimulus. • The Reserve Bank of Australia’s cautiousness towards rate cuts continues to be a leading driver of the AUD. • Looming uncertainty regarding possible tariff announcements from President Trump may generate volatility across markets worldwide. • US Services PMI jumped to 54.3, bolstering the US Dollar, while Manufacturing PMI was lower than forecasted. • Resistance at 0.6300 and support at 0.6220 will be key to deciding the pair’s next direction. • Beijing’s proposals to enhance consumption and wages would indirectly assist the Australian economy because of robust trade links. The Australian Dollar held firm after Treasurer Jim Chalmers delivered the 2025/26 budget that provided significant economic predictions, such as tax relief intended to ease money woes for households. The budget estimates a 2024-25 deficit of A$27.6 billion and A$42.1 billion for 2025-26, as the government aims to balance economic growth with fiscal prudence. Moreover, the GDP of Australia is predicted to expand by 2.25% in 2026 and 2.5% in 2027, indicating modest economic growth. The Reserve Bank of Australia (RBA) remains cautious in its interest rate moves, keeping inflation under control while fostering economic stability. AUS/USD DAILY PRICE CHART CHART SOURCE: TradingView The Australian Dollar maintained its calmness after Treasurer Jim Chalmers presented the 2025/26 budget that made important economic projections, such as the reduction of tax that would help alleviate financial burdens on households. The budget forecasts a deficit of A$27.6 billion for 2024-25 and A$42.1 billion for 2025-26, which shows that the government is striking a balance between economic growth and fiscal prudence. Moreover, Australia’s GDP is projected to increase by 2.25% in 2026 and 2.5% in 2027, indicating moderate economic growth. The Reserve Bank of Australia (RBA) remains cautious in its interest rate policy, keeping inflation under control while maintaining economic stability. TECHNICAL ANALYSIS The AUD/USD currency pair is trading around 0.6290, with technical indicators indicating a cautious market mood. The currency pair continues to be in a bearish trend and trades in a falling channel. The 14-day Relative Strength Index (RSI) is at a level slightly below 50, which means the currency has weak momentum. The important support remains at 0.6220 and breaking below this may drag the pair towards its seven-week low of 0.6187. Resistance on the upside comes at 0.6308 (nine-day Exponential Moving Average) and 0.6310 (50-day EMA). A breakout above these levels may signal short-term bullish momentum, while continued rejection at resistance may reinforce the prevailing downtrend. FORECAST The outlook for the Australian Dollar is mixed and dependent on both local and international considerations. To the upside, solid economic fundamentals from Australia, such as better Manufacturing and Services PMI reports, can underpin the AUD. Also, hopes of further stimulus from China, Australia’s biggest trading partner, could increase demand for Australian exports, supporting the currency. If the Reserve Bank of Australia continues to be cautious on interest rates without hinting at aggressive cuts, investor sentiment in the AUD might stay firm. A move above key technical resistance levels at 0.6310 could pave the way for more gains in the near term. But downside risks remain as uncertainty regarding US trade policies hangs in the air. Possible tariff announcements by President Trump have the potential to upset global trade and hurt risk-sensitive currencies such as the AUD. The US Dollar is also supported by robust Services PMI data and dovish comments from Federal Reserve officials, which could cap the AUD’s upside. If the AUD/USD currency pair is unable to sustain support at 0.6220, then further losses towards 0.6187 may be anticipated, supporting a bearish trend in the short term.

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