Exchange Rate Calculator

The NZD/USD currency pair, representing the exchange rate between the New Zealand Dollar (NZD) and the United States Dollar (USD), has experienced notable fluctuations over the past few months. These movements have been influenced by a combination of economic indicators, central bank policies, and global market sentiments.

Recent Exchange Rate Trends

As of May 3, 2025, the NZD/USD pair is trading at approximately 0.5740. This marks a decline from its peak of 0.6391 on September 30, 2024, indicating a depreciation of about 10% over this period. The pair reached a low of 0.5730 in December 2024, reflecting the downward trend that has persisted in recent months.

Economic Indicators and Central Bank Policies

New Zealand's Economic Performance:

New Zealand's economy has shown signs of weakness, with several key indicators highlighting this trend:

• Retail Sales: Electronic card transactions remained stagnant in November 2024, showing a 0% change compared to the previous month, which had a 0.7% increase.

• Building Permits: In October 2024, building permits declined by 5.2%, a sharper contraction than the 2.4% decrease observed in the prior month.

• Business PMI: The Purchasing Managers' Index for November 2024 stood at 45.5, indicating a contraction and a slight decline from October's 45.8.

In response to these economic challenges, the Reserve Bank of New Zealand (RBNZ) has implemented a series of interest rate cuts. In November 2024, the RBNZ reduced the Official Cash Rate (OCR) by 50 basis points to 4.25%, marking the third consecutive cut that year. Further reductions are anticipated to stimulate economic growth.

United States Economic Performance:

Conversely, the U.S. economy has demonstrated resilience:

• GDP Growth: The U.S. economy grew by 2.3% in Q4 2024, following a 3.1% growth in Q3 2024.

• Personal Income and Outlays: Personal income increased by 0.4% in December 2024, while personal consumption expenditures (PCE) increased by 0.7%.

• Trade Deficit: The U.S. current account deficit widened to $310.9 billion in Q3 2024, up from $275.0 billion in Q2 2024.

The Federal Reserve has maintained a cautious stance on monetary policy, with the Federal Funds Rate currently at 4.75%. Fed Chair Jerome Powell has indicated that the central bank is closely monitoring inflation and trade policies to determine future rate adjustments.

Geopolitical Events and Global Trade

Trade tensions between the U.S. and China have also impacted the NZD/USD pair. The U.S. administration's increase in tariffs on steel and aluminum imports, coupled with China's retaliatory measures, have heightened global trade war concerns. Given New Zealand's significant trading relationship with China, these uncertainties have adversely affected the NZD.

Technical Analysis

As of March 27, 2025, technical indicators for the NZD/USD pair present a mixed outlook:

• Relative Strength Index (RSI): At 50.448, indicating neutral momentum.

• Moving Averages: A balance between buy and sell signals, with both simple and exponential moving averages showing equal numbers of buy and sell indications.

• Pivot Points: The pair is trading near the pivot point of 0.5739, with immediate support at 0.5738 and resistance at 0.5742.

Forecasts for the NZD/USD Pair

Short-Term Forecast (Next 1-3 Months):

In the short term, the NZD/USD pair is expected to trade around 0.5933 by Q2 2025, representing a 2.97% increase from the current rate.

Medium-Term Forecast (Next 3-6 Months):

Over the medium term, projections suggest the pair could reach 0.6028 by Q3 2025, indicating a 4.62% increase from the current rate.

Long-Term Forecast (Next 6-12 Months):

Looking further ahead, the NZD/USD pair is anticipated to continue its upward trend, potentially reaching 0.62 by Q1 2026, marking a 7.6% increase from the current rate.

Conclusion

The NZD/USD exchange rate has been influenced by a combination of New Zealand's economic challenges, the RBNZ's monetary easing, the U.S. economy's relative strength, and global trade tensions. While technical indicators currently present a neutral outlook, forecasts suggest a gradual appreciation of the NZD against the USD over the next year. Investors should monitor economic data releases, central bank policies, and geopolitical developments to make informed decisions regarding this currency pair.