- The NZD/USD advances while concerns about possible economic repercussions in the USA continue to weigh on the US dollar.
- The New Zealand dollar remains firm after PBOC’s decision to keep its LPR for a year for five years at 3.10% and 3.60%, respectively.
- The White House has intensified commercial tensions between the US and China by imposing tariffs on Chinese ships that dochet in US ports.
The NZD/USD continues its winning streak that began on April 9, quoting about 0.5970 during the Asian session on Monday. The New Zealand dollar (NZD) is driven by a weaker US dollar (USD), which is under pressure due to the growing concerns about economic repercussions in the US of US tariffs.
The New Zealand dollar remains stronger after the decision on interest rates of the Popular Bank of China (PBOC) on Monday. The PBOC maintained its preferential loan rates (LPR) without changes, maintaining the rate at one year at 3.10% and the five -year rate at 3.60%.
The feeling towards the NZD improved after US President Donald Trump announced exemptions for key technological products, mainly manufactured in China, the largest commercial partner in New Zealand, of the “reciprocal” tariffs proposed. Meanwhile, the American dollar index (DXY) falls more than 0.50%, quoting around 98.50, its lowest level since April 2022, at the time of writing.
Despite the exemptions, the White House has imposed tariffs on Chinese ships that dock in US ports, threatening to interrupt global shipping routes and even more climbing tensions in the commercial conflict between the US and China.
In political developments, Thursday reports suggested the frustration of President Trump with the president of the Federal Reserve (Fed), Jerome Powell, even considering his dismissal. Although the markets showed little immediate reaction, the Economic Advisor of the White House, Kevin Hassett, confirmed that Trump is exploring the possibility.
Economic indicator
Decision on the interest rate of the PBOC
The Monetary Policy Committee (MPC) of Banco Popular de China (PBOC) celebrates a quarterly scheduled meetings. However, China’s reference interest rate – the preferential loan rate (LPR), a price reference for bank loans – is set every month. If the PBOC provides high inflation (aggressive) increases interest rates, which is bullish for the RenminBi (CNY). Similarly, if the PBOC sees that inflation in the Chinese economy is decreasing (Dovish) and cuts or keeps interest rates without changes, is bassist for the CNY. Even so, China’s currency does not have a floating exchange rate determined by the markets and their value against the US dollar is mainly fixed by the PBOC daily.
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Last publication:
Mar Mar 20, 2025 01:15
Frequency:
Irregular
Current:
3.1%
Dear:
3.1%
Previous:
3.1%
Fountain:
The People’s Bank of China
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
