The NZD/USD pair declined yesterday, recording 0.5863 today, its lowest level in two weeks, after falling by about 2% from the recent high of 0.6008 reached on September 17, 2025, down to the low recorded today. However, the pair remains up approximately 5% since the beginning of the year.
Recent economic data from New Zealand reflects weakness in the country’s economic performance, as shown by the following indicators:
- GDP for the second quarter of this year contracted by 0.9%, a figure lower than expectations (a 0.3% contraction) and significantly below the previous reading, which showed 0.9% growth.
- The Business PMI fell to 49.9, compared to 52.8 in the previous reading.
- Consumer Confidence dropped to 90.9, down from the previous level of 91.2.
A key factor that contributed to the downward pressure on the NZD/USD pair is the strength of the U.S. dollar against most major currencies, despite the Federal Reserve cutting interest rates by 25 basis points, as widely anticipated by the markets. The Fed’s dot plot also indicated the possibility of an additional 50 basis points cut during the remainder of the year.
However, in his press conference, Federal Reserve Chair Jerome Powell stated that prices may rise due to tariffs over the current and coming years and emphasized that future interest rate decisions will be data dependent. Markets interpreted his remarks as not strongly dovish.
From a technical analysis standpoint, if the pair breaks below the pivot level at 0.5911, it may target the following support levels: 0.5850, 0.5811, and 0.5750. On the other hand, if the pair breaks above the pivot, it may head toward the following resistance levels: 0.5950, 0.6011, and 0.6050.
As for the Relative Strength Index (RSI), currently around 42, it indicates a bearish momentum on the pair.
Please note that this analysis is provided for informational purposes only and should not be considered as investment advice. All trading involves risk.
