FX.co ★ New Zealand Dollar Stabilizes

The New Zealand dollar stabilized at approximately $0.60 on Tuesday following four consecutive declines, as investors assessed trade-related risks affecting the export-oriented currency. President Donald Trump sent out initial tariff warning letters, with proposed rates between 25% and 40%. However, he suggested potential flexibility, referring to the August 1 deadline as "not 100% firm," indicating the possibility of further negotiations. Domestically, all eyes are now on the upcoming interest rate announcement on Wednesday. The Reserve Bank is expected to maintain current rates, marking a pause after a series of aggressive reductions since last August. The central bank has decreased the official cash rate by 225 basis points, from 5.5% to 3.25%, which included three 50 basis point cuts. Market expectations are leaning towards at least one additional 25 basis point reduction later this year, driven by concerns over growth risks due to the economic impact of U.S. tariffs.