Home Daily Commentaries NZD steady in face of new tariffs

NZD steady in face of new tariffs

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.

| Tuesday 11 February, 2025

Daily Currency Update

The New Zealand dollar opens this morning in much the same position as it started the week, offering some resistance to US exceptionalism, following another Trump tariff promise. President Trump announced a new 25% tariff on Steel and Aluminium, forcing the NZD toward intraday and overnight lows south of US$0.5640. With little detail following Trump's proclamation, markets appeared content in sidelining major bets, opting to wait for more specific guidance surrounding the timing, extent and reach of new tariffs.

While steady against the USD, the NZD fell against the AUD, giving up AU$0.90. A rebound in metal prices has helped underpin the AUD and opens the door for the NZD to possibly slide below AU$0.8950. With no local data on the docket we look to Australian business and consumer sentiment surveys, commentary from Bank of England Governor Mark Carney and testimony from Fed chair Jerome Powell for direction through Tuesday.

Key Movers

Tariff headlines again dominated direction with President Trump announcing a new 25% tariff on Steel and Aluminium. The comments made by Air Force One again target the States' three biggest trading partners in Mexico, Canada and China. Just when Mexico and Canada thought they had earned a reprieve from the firing line, the promise of new tariffs cast a new pall of uncertainty over the new administration's trade agenda.

Unlike last Monday, the market reaction was somewhat muted as there has been little colour added to the headline comments and analysts are sidelining major bets until more details are made available. Most majors are little changed and our attention turns to Fed Chair Jerome Powell as he testifies in front of a Senate committee on monetary policy. While we acknowledge Powell is unlikely to stray too far from the comments made following the last Fed policy meeting, we are keenly attuned to any commentary on tariffs, their possible impact on inflation and the Fed’s plan to normalise rates through 2025.

Expected Ranges

  • NZD/USD: 0.5580 - 0.5720 ▼
  • NZD/EUR: 0.5420 - 0.5520 ▼
  • GBP/NZD: 2.1700 - 2.2000 ▲
  • NZD/AUD: 0.8950 - 0.9050 ▼
  • NZD/CAD: 0.8020 - 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.