NZD eyes break back above US$0.60 as USD gives back gains
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Daily Currency Update
The NZD advanced Tuesday, finding support in a broadly weaker USD, climbing back through US$0.60. The USD extended its correction, giving up gains won through last week. With little of note on the domestic agenda, the NZD tracked sideways, drifting toward session lows below US$0.5950 before lurching higher through overnight trade. With the USD on the back foot, the NZD climbed to an intraday high just short of US$0.6003 before edging back toward US$0.5995 leading into this morning’s open. With most majors enjoying gains against the USD, there has been little net movement in NZD crosses.Our attention remains with tariff headlines and newsflow as another quiet macroeconomic docket awaits us today. Recent trade deals suggest the final tariff rate may settle nearer the higher end of liberation day expectations, which may drag on NZD upside through the near term. We are closely monitoring headlines for direction.
Key Movers
The US dollar underperformed Tuesday, extending Monday’s correction and giving back more of the gains won through trade last week. Data has been sparse, but signs the impacts of tariffs are being felt across the economy continue to emerge. General Motors shares plunged as it announced a 1-billion-dollar tariff hit as it absorbs costs of imports from its main manufacturing hubs in South Korea, Mexico and Canada while final trade deals are being negotiated. The announcement highlights the struggles facing many US companies that import components and finished products. While some have already passed the costs through to the consumer, many have absorbed the hit until a clearer picture emerges, explaining perhaps why the full impact of the tariffs implemented thus far has not been felt across the US economy. The Yen was the best-performing major, while the euro and GBP also benefited from broader USD weakness.With little of note on today’s macro docket, our attentions remain with tariff newsflow for direction.
Expected Ranges
- NZD/USD: 0.5920 - 0.6020 ▲
- NZD/EUR: 0.5520 - 0.5620 ▼
- GBP/NZD: 2.2400 - 2.2800 ▼
- NZD/AUD: 0.9100 - 0.9200 ▲
- NZD/CAD: 0.8100 - 0.8200 ▼