NZD Corporate FX Update
President Trump’s tariff policy overhangs the NZD outlook in the first half of the year.
Early in President Trump’s second term we have seen him stretch legal boundaries to exude considerable executive power, threaten/impose/delay tariffs, and offer frequent daily soundbites to reporters, driving intraday volatility in FX markets.
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The NZD in 2025
The NZD ended 2024 on a very weak note, with the currency plunging nearly 12% in Q4 after reaching its highest level for the year at the end of Q3 (0.6379). The NZD traded at its low for the year on the last day of the month (0.5588). The election of Trump as President and ongoing resilience of the US economy, against a backdrop of a poorly performing NZ economy, were key drivers of the NZD’s demise.
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NZD Corporate FX Update
We see NZD risks weighed to the downside through the first half of 2025. FX volatility and uncertainty are likely higher under the new US government.
In early November, post the US election, we made a significant downward revision to our NZD/USD projections. While the change in US economic policy direction with Trump as President was a key motivation for the revision, the stronger for longer US economy supported the change in outlook.
Full Currency Research is available to BNZ Wholesale clients upon request, please email bnz_research@bnz.co.nz to subscribe.