FX.co ★ New Zealand Dollar Holds Decline

The New Zealand dollar maintained its recent downward trend, hovering around $0.575 on Friday, influenced by risk-averse market sentiment stemming from ongoing trade war anxieties. Investor caution remained as U.S. President Donald Trump was set to impose reciprocal tariffs on major trading partners by April 2. Adding pressure to the Kiwi was the strengthening U.S. dollar, bolstered by the Federal Reserve's indication that it would not hasten further interest rate cuts. Domestically, despite new data showing New Zealand's economy emerging from a recession, the currency did not benefit, as there remain notable areas of economic weakness. Market expectations for monetary policy easing are strong, with projections of approximately 60 basis points in rate cuts—equivalent to two or three reductions—anticipated by the end of the year. Nonetheless, despite these challenges, the New Zealand dollar is still on track for a modest weekly gain.