- The NZD/USD exchange rate declines to approximately 0.5985 during Friday’s Asian trading hours.
- Chinese officials have communicated to the United States that all unilateral tariffs must be removed to facilitate discussions.
- The Chinese Finance Ministry has stated that the current global economic expansion is hampered by tariff impositions and trade conflicts.
The NZD/USD currency pair is slightly weaker, trading near 0.5985 in the Asian session on Friday, influenced by a stronger US Dollar. The absence of advancement in easing trade relations between the US and China is placing downward pressure on the Kiwi, which often reflects Chinese economic activity. The concluding assessment of Michigan Consumer Sentiment will be released later today.
Late Thursday, US President Donald Trump indicated that his administration was engaged in trade discussions with China. Conversely, China has stated that no economic and trade negotiations have occurred, and they are pressing the US to eliminate all unilateral tariffs if a resolution is genuinely desired. Apprehension regarding trade disputes between the world’s two largest economies could negatively impact the New Zealand Dollar (NZD), given China’s significance as a major trading partner for New Zealand.
Increasing expectations that the Reserve Bank of New Zealand (RBNZ) will decrease its Official Cash Rate (OCR) at the meeting in May could further weaken the NZD. Market forecasts strongly suggest that the RBNZ will reduce its current 3.5% OCR by 25 basis points (bps) in May, with predictions of an additional decrease to 2.75% before the year concludes.
