The New Zealand dollar rose for a second consecutive day to around $0.574 on Thursday, benefiting from broad weakness in the US dollar. The greenback came under pressure amid prospects of Federal Reserve rate cuts, alongside intensifying US-China trade tensions and the ongoing federal government shutdown, which have heightened concerns about the US economic outlook. However, the kiwi’s upside remained limited by a dovish monetary policy outlook at home. Reserve Bank of New Zealand Chief Economist Paul Conway reiterated on Wednesday that the central bank remains open to further policy easing, though it will wait for economic data before making a decision. Markets are currently pricing in another rate cut in November, with rates expected to fall to 2.0% by 2026. Supporting this view, the latest data showed that New Zealand’s annual food inflation eased to a five-month low of 4.1% in September from 5.0% in August.
