NZDUSD - The uptrend of the dollar is over?!The NZDUSD currency pair is located between the EMA200 and EMA50 in the 4H timeframe. In case of a downward correction, we can see the demand zones and buy within that zones with the appropriate risk reward.
Although Trump has announced plans to impose tariffs on Canada, Mexico, and several other countries, closer analysis suggests that these measures are more related to addressing issues like migration and drug trafficking than economic policies. Therefore, these actions are not considered a serious threat to international trade and may be interpreted differently by the markets.
The appointment of Scott Bassant, a seasoned expert in currency markets and hedge funds, as the head of the economic team under President-elect Trump, has brought greater confidence to the markets. Bassant, who leans towards boosting the stock market, is likely to pursue more moderate policies, including reducing reliance on tariffs.
One of Bassant’s proposed approaches involves using a weaker dollar instead of trade wars and tariffs to achieve economic goals such as increasing domestic production, improving trade balance, and strengthening the stock market. If international agreements, particularly with China, are reached, this strategy could put additional pressure on the dollar.
Conway, Chief Economist of the Reserve Bank of New Zealand, has stated that Trump’s policies are currently viewed as a medium-term risk to inflation and economic volatility. Moreover, forecasts have not yet accounted for potential U.S. tariffs. Conway has also predicted that house prices in New Zealand will rise by 6.8% next year. While he does not expect a significant boom in housing prices, he anticipates a modest revival in the real estate market.
Meanwhile, Silk of the Reserve Bank of New Zealand has announced that for February, a rate cut of 25 or 50 basis points is under consideration. During this week’s meeting, all options were reviewed, but the committee quickly reached consensus on a 50-basis-point cut. He clarified that a reduction beyond this level was deemed unnecessary as there remains a need to focus on controlling domestic inflation.
