Home Daily Commentaries New Zealand dollar trades lower driven by shifting investor sentiment

New Zealand dollar trades lower driven by shifting investor sentiment

Brett Ottawa
Written by
Brett Ottawa

Brett Ottawa

OFXpert

Brett brings a wealth of experience, boasting more than 15 years in the foreign exchange market.

| Monday 16 June, 2025

Daily Currency Update

Last week, the New Zealand dollar (NZD) experienced a decline against the US dollar (USD), influenced by a combination of geopolitical tensions and shifting investor sentiment. Rising oil and gold prices, driven by Middle Eastern uncertainties, provided support to the NZD, especially in sectors linked to these commodities. The Reserve Bank of New Zealand's stance on interest rates, compared to the Federal Reserve's policies, continues to influence the NZD's performance. Analysts are monitoring potential rate cuts and their impact on the currency pair. Analysts suggest that the NZD/USD pair may continue to trade within the established range, with geopolitical developments and central bank policies being key factors to watch in the coming weeks. The NZD/USD pair is testing key technical support around the 0.6000 mark. A break below this level could expose the pair to further downside, potentially targeting the 50-day exponential moving average (EMA) near 0.5925. On the upside, the 0.6080–0.6100 range has proven to be a significant resistance zone. A sustained move above this level could indicate bullish momentum. Analysts anticipate the NZD/USD to trade between 0.6000 and 0.6100 in the short term, with potential fluctuations based on upcoming economic data and market sentiment.

Key Movers

On Friday, June 13, 2025, the Dow Jones Industrial Average (DJIA) closed at 42,197.79, marking a significant decline of 769.83 points, or 1.8%, for the day. This drop was primarily driven by escalating geopolitical tensions between Israel and Iran, which led to a surge in oil prices and heightened market volatility. The broader market also experienced downturns, with the S&P 500 falling 1.1% and the Nasdaq Composite declining 1.3%. The Producer Price Index (PPI) data released midweek showed annualized core PPI inflation easing to 3.0%, while headline PPI inflation rose to 2.6%. These figures were below market expectations, providing a brief rebound for the DJIA. Looking ahead and investors are closely monitoring the Federal Reserve's upcoming meeting for insights into potential interest rate adjustments. However, persistent uncertainties regarding inflation, trade policies, and geopolitical tensions may continue to influence market movements. The University of Michigan's Consumer Sentiment Index for June 2025 has shown a significant rebound, marking the first improvement in six months. Despite these positive developments, 44% of consumers still anticipate being financially worse off in a year, the highest level since records began in 1978. The final June 2025 data is scheduled for release on Friday, June 27, 2025.

Expected Ranges

  • NZD/USD: 0.5900 - 0.6100 ▼
  • NZD/EUR: 0.5100 - 0.5300 ▼
  • GBP/NZD: 2.0400 - 2.0600 ▲
  • NZD/AUD: 1.0700 - 1.0900 ▼
  • NZD/CAD: 0.8050 - 0.8250 ▼

Written by

Brett Ottawa

OFXpert

Brett brings a wealth of experience, boasting more than 15 years in the foreign exchange market. He started his foreign exchange career with OFX more than a decade ago, as a private dealer catering to individual clients. He later transitioned to the corporate sector, assuming the position of Corporate Senior Relationship Manager. What truly excites Brett is the opportunity to engage with people, supporting their business growth and sharing in their successes.

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