NZD/USD backs off from 0.6000 as dovish RBNZ fades and tariff turmoil deepens
Oleh Joshua Gibson
Tarikh Diterbitkan: 24 Feb 2026 | Tarikh Diubah: 24 Feb 2026
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The RBNZ's dovish hold last week weighed heavily on the New Zealand Dollar, with the central bank signaling that monetary policy would remain accommodative for some time and that a rate hike later in 2026 is possible but not fully priced in.
- New Zealand Dollar finds resistance at the round number after last week's RBNZ-driven selloff collides with a shifting US tariff regime.
- The Reserve Bank of New Zealand (RBNZ) held rates at 2.25% last Wednesday in new Governor Anna Breman's debut, pushing the projected first hike to late 2026 and trimming market expectations for near-term tightening.
- Trump's 15% global tariff under Section 122 of the Trade Act takes effect Tuesday after the Supreme Court struck down his IEEPA tariffs last Friday, adding a fresh layer of uncertainty for risk-sensitive currencies.
The RBNZ's dovish hold last week weighed heavily on the New Zealand Dollar, with the central bank signaling that monetary policy would remain accommodative for some time and that a rate hike later in 2026 is possible but not fully priced in. Market pricing for a hike by year-end was sharply trimmed, with only one increase now favoured, down from two before the decision, and a September move now carrying just a 40% probability. On the US side, the Supreme Court's 6-3 ruling on Friday struck down the administration's IEEPA tariffs, prompting Trump to threaten to impose a new 15% global tariff under Section 122 of the Trade Act, to become effective in the coming months. The shift from IEEPA to Section 122 authority introduces fresh trade uncertainty, though the 150-day statutory limit on the new tariffs and the prospect of over $160 billion in importer refunds could act as a partial offset for risk sentiment. Federal Reserve (Fed) speakers dominate Tuesday's US calendar, while Wednesday brings the Australian CPI release, which could spill over into Kiwi crosses.
Bounce from 0.5956 as Stochastic falls through the midpoint
On the daily chart, NZD/USD fell 0.34% on Monday, briefly testing below 0.5960 before bouncing back toward 0.6000 after a bullish attempt earlier in the session fizzled out. The pair is holding above the rising 50-day Exponential Moving Average (EMA) at 0.5915 and the 200-day EMA at 0.5860, keeping the broader uptrend from the late November swing low near 0.5600 valid. The Stochastic Oscillator has crossed bearish and is falling through the midpoint, suggesting momentum is weakening after the retreat from the year-to-date high at 0.6094. A cluster of wide-range candles with alternating direction over recent sessions points to choppy, two-way price action rather than a clear trend. Immediate support sits at the 0.5956 session low and the psychological 0.5900 level, while resistance is at 0.6000 and then the 0.6094 high; a break above would target 0.6200, but a loss of 0.5900 could expose the 50-day EMA.
NZD/USD daily chart
New Zealand Dollar FAQs
The New Zealand Dollar (NZD), also known as the Kiwi, is a well-known traded currency among investors. Its value is broadly determined by the health of the New Zealand economy and the country’s central bank policy. Still, there are some unique particularities that also can make NZD move. The performance of the Chinese economy tends to move the Kiwi because China is New Zealand’s biggest trading partner. Bad news for the Chinese economy likely means less New Zealand exports to the country, hitting the economy and thus its currency. Another factor moving NZD is dairy prices as the dairy industry is New Zealand’s main export. High dairy prices boost export income, contributing positively to the economy and thus to the NZD.
The Reserve Bank of New Zealand (RBNZ) aims to achieve and maintain an inflation rate between 1% and 3% over the medium term, with a focus to keep it near the 2% mid-point. To this end, the bank sets an appropriate level of interest rates. When inflation is too high, the RBNZ will increase interest rates to cool the economy, but the move will also make bond yields higher, increasing investors’ appeal to invest in the country and thus boosting NZD. On the contrary, lower interest rates tend to weaken NZD. The so-called rate differential, or how rates in New Zealand are or are expected to be compared to the ones set by the US Federal Reserve, can also play a key role in moving the NZD/USD pair.
Macroeconomic data releases in New Zealand are key to assess the state of the economy and can impact the New Zealand Dollar’s (NZD) valuation. A strong economy, based on high economic growth, low unemployment and high confidence is good for NZD. High economic growth attracts foreign investment and may encourage the Reserve Bank of New Zealand to increase interest rates, if this economic strength comes together with elevated inflation. Conversely, if economic data is weak, NZD is likely to depreciate.
The New Zealand Dollar (NZD) tends to strengthen during risk-on periods, or when investors perceive that broader market risks are low and are optimistic about growth. This tends to lead to a more favorable outlook for commodities and so-called ‘commodity currencies’ such as the Kiwi. Conversely, NZD tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.
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