The NZD/USD currency pair fell, reaching about $0.586. This drop is due to the yuan’s struggles, which are affected by US tariff threats and China’s ongoing economic troubles. As New Zealand’s top trading partner, China’s economic climate heavily influences the Kiwi.
RBNZ Cuts Rate to 4.25%
Last week, the Reserve Bank of New Zealand (RBNZ) reduced its cash rate by 50 basis points to 4.25%. This decision aims to tackle mild inflation and a slow economy.
Moreover, the RBNZ hinted at possibly cutting rates further by another 50 basis points early next year, depending on economic developments.
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New Zealand Trade Terms Improved by 2.4%
In a positive turn, New Zealand’s goods trade terms improved in the last quarter, rising by 2.4%. This improvement came as export prices increased by 0.7% while import prices fell by 1.7%.