When Trump’s tariffs started, stock prices fell around the world. This made people avoid risk, so they bought yen and sold New Zealand dollars.
After the news, NZD/JPY first went up to 86.76 yen but quickly dropped to the low 84 yen range. It stayed around 84 yen for a while, but as stock prices kept falling, people bought more yen, and NZD/JPY fell to 81.09 yen — the lowest level since March 2023.
Some people joked that even penguins on islands near New Zealand were taxed. In reality, the tariffs on New Zealand were not very strong, but since the New Zealand dollar is seen as a risk currency, it was hurt badly by the falling stock market.
This week, the central bank of New Zealand (RBNZ) is expected to cut interest rates by 0.25%. However, this is already expected by the market.
Because the trade war may get worse with more tariffs from many countries, the New Zealand dollar will likely stay weak. Also, since the central bank governor recently resigned and has not been replaced, no major changes in policy are expected.
So, NZD/JPY will likely move mainly due to the trade situation.
This week’s NZD/JPY forecast range: 83.50 – 79.40
Note: This information is not a guarantee of profit. Make your own decisions when trading.