NZD/USD edges lower despite softer US Dollar, weighed by China-linked concerns

NZD/USD eases toward 0.5910 on Tuesday, trimming Monday’s gains
China’s latest rate cut fuels demand concerns, weighing on the China-linked Kiwi
Kiwi holds above the 21-day EMA but remains locked in a consolidative range

Vishal Chaturvedi FXStreet

The New Zealand Dollar (NZD) slides lower against the US Dollar (USD) on Tuesday, with NZD/USD slipping to 0.5910 in early American trading hours. The move marks a mild pullback from the previous day's recovery, as traders react to China’s latest interest rate cut, which raised fresh concerns over slowing growth in the region.

The Kiwi remains within a consolidative range but is struggling to build momentum as selling pressure emerged after the People’s Bank of China (PBoC) lowered both of its key lending benchmarks. The one-year loan prime rate (LPR) — the reference for most business and household loans — was cut by 10 basis points to 3.0%, while the five-year LPR, which influences mortgage rates, was also reduced by 10 bps to 3.5%. The move, aimed at stimulating domestic demand, highlighted persistent concerns about China's sluggish recovery, weighing on currencies with close trade ties to the Chinese economy, including the New Zealand Dollar.

Latest economic data released on Monday showed that the BusinessNZ Services PMI slipped to 48.5 in April, marking a second consecutive month of contraction. While the weak services data highlights ongoing domestic headwinds, it was partially offset by a sharp rebound in producer prices. Q1 input prices rose 2.9%, while output prices climbed 2.1%, the strongest gains since mid-2022. While markets still expect the Reserve Bank of New Zealand (RBNZ) to cut rates by 25 basis points later this month, the inflation rebound may temper expectations for a more aggressive easing path.

Looking ahead, traders will turn their focus to a packed domestic calendar. New Zealand’s trade balance is due late Tuesday, followed by the government’s annual budget release on Thursday, expected to slash 2025 baseline spending to NZ$1.3 billion from NZ$2.4 billion. Friday’s Q1 retail sales report will provide a fresh update on consumer activity.

Meanwhile, the US Dollar remains on the defensive, as sentiment weakened following Moody’s downgrade of the US credit rating from Aaa to Aa1. The move was driven by rising concerns over ballooning US government debt and an expanding budget deficit

Economic Indicator

Trade Balance NZD (YoY)

Trade balance, released by Statistics New Zealand, is the difference between the value of country's exports and imports, over a period of year. A positive balance means that exports exceed imports, a negative ones means the opposite. Positive trade balance illustrates high competitiveness of country's economy.

AUD/USD falls to near 0.7100 after slipping below 50-day EMA

AUD/USD depreciates after registering minor gains in the previous day, trading around 0.7120 during the Asian hours. The technical analysis of the daily chart shows the pair consolidating sideways within a rectangle pattern, as neither bulls nor bears gain control. The AUD/USD pair is holding a slight bearish tone however as it sits beneath both the nine-day and 50-day EMAs.

Japanese Yen edges up but remains close to the 160.00 intervention threshold

The Japanese Yen edges up against the US Dollar on Friday, but the USD/JPY pair remains above 159.90 at the time of writing, unable to put a significant distance from the 160.00 level, considered the limit of tolerable JPY weakness for Japanese authorities.

Gold returns to the red, awaits US NFP

Gold price is looking to test the weekly lows, while in the red near $4,450 in the early European session on Friday. The precious metal remains vulnerable amid ongoing geopolitical turmoil. Traders will closely monitor the developments surrounding the US-Iran peace deal and the US May employment report later on Friday.

Arthur Hayes' “Holy Trinity” is dead: Exits Zcash after Orchard Pool exploit

Arthur Hayes has entirely dumped his “Holy Trinity” holdings by offloading his Zcash holdings on Friday. The privacy coin is down 13% so far on Friday, extending Thursday’s 26% decline after an Orchard Shielded Pool audit revealed a critical vulnerability that allowed the undetectable minting of fake coins. Hayes continues to hold Worldcoin ahead of the upcoming SpaceX Initial Public Offering, on the chance of a “high-beta proxy” rally.

Nonfarm Payrolls set to show stable labor market in May as markets digest Fed hawkish shift

The United States Bureau of Labor Statistics will release the Nonfarm Payrolls data for May on Friday at 12:30 GMT. Investors expect NFP to rise by 85K following the surprisingly strong 185K and 115K increases recorded in March and April, respectively.

Recession on paper: What really moves the Canadian Loonie now?

Statistics Canada handed the headline writers a gift and the analysts a headache. Real GDP shrank 0.1% on an annualized basis in the first quarter, and with the fourth quarter of 2025 revised down to a 1.0% contraction, that is two negative quarters in a row, the textbook definition of a technical recession and Canada's first since the pandemic.