FX.co ★ New Zealand Dollar Strengthens

The New Zealand dollar experienced a rally, reaching approximately $0.60 on Monday as it rebounded from previous session losses. This was largely due to a weakened US dollar amid renewed concerns over trade policies. Recently, President Trump unveiled his intention to increase tariffs on steel imports to 50% starting Wednesday, fueling apprehensions about possible slower economic growth and heightened inflation. In parallel, the Reserve Bank of New Zealand recently lowered its official cash rate, which initially exerted some pressure on the currency. However, the May reduction indicates that the easing cycle might be drawing to a close after a total of 225 basis points cuts since August. RBNZ Assistant Governor Karen Silk highlighted that interest rates are presently within the neutral zone of 2.5%–3.5%, and any future rate adjustments will hinge on economic data, as the effects of previous cuts continue to permeate through the economy. Despite persistent global trade uncertainties, she anticipates a recovery, underpinned by earlier monetary easing actions.