NZD/USD REMAINS CAPPED BELOW 0.6000 ON ESCALATING US-CHINA TRADE TENSIONS
NZD/USD REMAINS CAPPED BELOW 0.6000 ON ESCALATING US-CHINA TRADE TENSIONS
The NZD/USD currency pair has been under significant pressure, trading below the 0.6000 mark due to escalating trade tensions between the United States and China.
During the Asian trading hours on Tuesday, the NZD/USD pair softened to approximately 0.5995, reflecting market apprehension over the intensifying trade war between the US and China.
In response to the US imposing a 10% tariff on Chinese goods, China retaliated by implementing a 15% tariff on US coal and LNG imports, along with an additional 10% tariff on crude oil, farm equipment, and certain automobiles.
President Donald Trump emphasized that if no agreement is reached, tariffs would be "very, very substantial," heightening market uncertainty and risk aversion.
As China is New Zealand's largest trading partner, the ongoing trade tensions have a direct impact on the New Zealand Dollar, leading to its depreciation against the US Dollar.
Expectations are mounting that the Reserve Bank of New Zealand may implement further rate cuts to mitigate the economic impact of the trade tensions, exerting additional downward pressure on the NZD.
