NZD/USD steady as RBNZ holds rates, Trump expands tariff campaign

• NZD/USD trades flat just below 0.6000 during the American trading session after rebounding from a two-week low.
• RBNZ maintained a dovish bias, signaling further easing is likely if inflation continues to ease.
• The Fed’s June Meeting Minutes showed most officials expect rate cuts later this year, weighing slightly on the USD.

The New Zealand Dollar (NZD) flattens against the US Dollar (USD) on Wednesday, with the Greenback paring its daily gains after the release of the Federal Reserve’s (Fed)June Meeting Minutes. Earlier in the day, the NZD found some support after the Reserve Bank of New Zealand (RBNZ) held its Official Cash Rate (OCR) steady at 3.25%, as widely expected, following six consecutive rate cuts since August 2024.

The NZD/USD pair is rebounding from a two‑week low following the RBNZ’s policy decision. At the time of writing, the pair is trading around 0.5999, little changed during American trading hours, as market participants digest the central bank’s steady stance. Attention is also turning to escalating global trade uncertainties, with investors awaiting further tariff developments that could influence currency flows and risk sentiment.

The Federal Open Market Committee (FOMC) June meeting minutes revealed that most officials expect interest rate cuts to be appropriate later this year, citing easing inflation pressures and potential economic and labor market softness. While some members supported a possible cut as early as the next meeting, others saw no need for policy changes in 2025. Policymakers generally viewed tariff-related inflation as likely to be temporary or limited and noted that inflation expectations remain well anchored. The minutes also pointed to elevated uncertainty tied to trade policy and geopolitical developments, although overall risks had eased slightly since the previous meeting.

US President Donald Trump escalated his tariff campaign on Wednesday by posting new letters on his social media platform, Truth Social, targeting six additional countries — Algeria, Iraq, Libya, Brunei, Moldova, and the Philippines — with fresh import duties ranging from 20% to 30%. The new tariffs, set to take effect on August 1, come just two days after Trump issued similar notices to 14 other nations. This latest move underscores Trump’s aggressive push for what he calls “reciprocal tariffs,” aimed at correcting what he describes as unfair trade practices. The rapid expansion of tariff threats is keeping global markets on edge, with investors closely watching how targeted countries respond and whether any breakthrough trade deals materialize ahead of the August deadline.

The RBNZ struck a cautious tone in its latest statement, noting that while members considered a 25-basis-point cut, they ultimately agreed to keep the OCR unchanged due to persistent inflation risks. The central bank reiterated its expectation to lower the OCR further in the coming months, assuming medium-term inflation pressures continue to ease. Markets now widely expect the next cut in August, with a potential shift to 2.75% by early 2026. Policymakers also flagged global trade uncertainty and soft domestic momentum as key downside risks, keeping the door open to further easing.