The NZD/USD pair has been on the rise for the second consecutive session, currently trading around 0.6010 during the Asian trading hours on Thursday. The New Zealand Dollar (NZD) saw gains after Chinese import data showed positive growth, reflecting the strong trade ties between New Zealand and China.
In April, Chinese imports surged by 8.4% year-on-year, beating expectations of 5.4%. Additionally, exports also grew by 1.5%, higher than the anticipated 1.0% gain. Despite concerns of potential tariffs on Chinese goods by the US, these figures brought a positive surprise. However, the Trade Balance USD increased to $72.35 billion, slightly below the expected $76.7 billion.
In New Zealand, the Reserve Bank of New Zealand (RBNZ) announced a delay in any potential rate cut until 2025. This decision was influenced by higher-than-expected inflation pressures in the first quarter. The RBNZ’s stance could provide support for the NZD.
On the other hand, the US Dollar (USD) is being supported by expectations of the Federal Reserve (Fed) maintaining higher interest rates for an extended period. This has led to a rise in US Treasury yields, limiting the NZD/USD pair’s advance.
Furthermore, hawkish comments from Federal Reserve officials have boosted the Greenback. Federal Reserve Bank of Boston President Susan Collins highlighted the importance of moderation in the US economy to achieve the central bank’s inflation target. Minneapolis Fed President Neel Kashkari mentioned that while rate hikes are unlikely, they are not completely off the table.