NZD markets fresh 2025 high as risk sentiment rebounds
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Daily Currency Update
The New Zealand dollar has recovered losses suffered following the conflict between Israel and Iran. After the initial risk off shock, the NZD bounced back above US$0.6050. Early fears the conflict would expand and draw in surrounding countries faded following reports Iranian officials were eager to resume nuclear talks and end the hostilities. Risk assets recovered, while safe haven currencies underperformed. The NZD ground its way higher through overnight trade, marking a fresh 2025 high just south of US$0.6090.Our attentions remain in the Middle East and with US trade policy as key markers for risk aversion, while NZ Inflation markers, a Bank of Japan policy meeting and US sales data round out the macro ticket.
Key Movers
Price action through Monday was again dominated by the Israel/Iran conflict, however, the risk off mood that permeated markets following the strikes on Friday has since faded as early fears the conflict would expand have paled. Strikes through the weekend did not expand to include key oil infrastructure sites, and outside parties have not yet been drawn into hostilities. Iran has been at pains to relay to the US and Israel that it does not want to elevate tensions and is eager to return to the nuclear negotiating table. In this environment, market mood has shifted, with many investors adopting a more sanguine view of the conflict. Risk assets recovered Friday’s losses, with safe haven’s underperforming. The CHF and JPY are sharply lower, while the USD has forced the euro back below 1.16 and Sterling below 1.36.Our attentions remain with Middle East hostilities, as the Bank of Japan policy meeting and US sales data dominate the macro ticket.
Expected Ranges
- NZD/USD: 0.5980 - 0.6120 ▲
- NZD/EUR: 0.5200 - 0.5300 ▲
- GBP/NZD: 2.2250 - 2.2550 ▼
- NZD/AUD: 0.9220 - 0.9320 ▲
- NZD/CAD: 0.8160 - 0.8300 ▲