Home Daily Commentaries NZD finds support as USD edges lower

NZD finds support as USD edges lower

Matt Richardson
Written by
Matt Richardson

Matt Richardson

OFXpert

Matt provides expertise in currency risk management to his clients, drawing from his 14 years of experience in foreign exchange.

| Wednesday 12 February, 2025

Daily Currency Update

The New Zealand dollar edged higher through trade on Tuesday, capitalising on a broader USD softening. With little of note on the macro-economic agenda and no new tariff headlines markets continued to unwind dollar gains won following Trump's promise of a 25% tariff on steel and aluminium at the weekend. The NZD has not enjoyed the same upward response as other majors yet still pushed back above US$0.5650 to mark intraday highs at US$0.5658. While recovering against the USD the NZD remains under pressure against the AUD and JPY. With the AUD pushing the NZD back below AU$0.90 the door is now open for a break back below AUD$0.8950 and while it recouped some ground against the Yen it is still down more than 1% through the last week and nearly 2% through the year to date as the promise of monetary policy normalisation in Japan fuels a broader yen recovery.

Our attention now turns to US CPI data for January while tariff headlines continue to guide a broader direction.

Key Movers

Price action across majors was largely muted through trade on Tuesday with no new tariff news and little reaction to commentary from Fed Chair Jerome Powell. The US dollar fell against most trading partners and is now back below its Friday close, giving up all gains won following Trump's announcement of a 25% tariff on steel and aluminium. With markets holding onto hopes that a large portion of the US tariff may yet be negotiated away the US dollar has struggled to extend upside runs on tariff headlines. That said it remains above the high seen after US non-farm payrolls and is underpinned by adding expectations for extensive US rate cuts through 2025. With the USD on the back foot, the euro climbed back through US$1.0350, while the pound pushed back above US$1.24. The yen was the day's big underperformer giving up ¥152 and allowing the USD to push back above ¥152.50.

Our attention today remains on tariff headlines as US CPI inflation data for January dominates the marco ticket.

Expected Ranges

  • NZD/USD: 0.5520 - 0.5720 ▲
  • NZD/EUR: 0.5400 - 0.5500 ▼
  • GBP/NZD: 2.1700 - 2.2100 ▲
  • NZD/AUD: 0.8950 - 0.9020 ▼
  • NZD/CAD: 0.8050 - 0.8150 ▲

Written by

Matt Richardson

OFXpert

As a Senior Corporate Client Manager, Matt provides expertise in currency risk management to his clients, drawing from his 14 years of experience in foreign exchange. Matt has clients who he has been working with for over a decade, a testament to his knowledge and dedication in the field. Matt is also a regular contributor on Ausbiz, offering clear and precise updates on currency market trends, showcasing his ability to interpret complex financial data into actionable insights.

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