FX.co ★ New Zealand Dollar Holds Decline

The New Zealand dollar stabilized around $0.577, though it retained most of the losses from earlier sessions as escalating US–Iran tensions weighed on risk appetite. The conflict showed little sign of easing, with President Donald Trump warning of a possible escalation after Houthi militants attacked two Saudi Arabian oil tankers in the Red Sea.

While the conflict has intensified inflation concerns via higher oil prices, it has also increased downside risks for the New Zealand economy. The country is heavily reliant on oil imports from the Middle East, leaving the kiwi exposed to potential supply disruptions and rising energy costs.

Even so, the Reserve Bank of New Zealand is widely expected to raise interest rates again in September, following stronger-than-expected inflation data. Market projections suggest the policy rate could reach at least 3.0% by the end of the year and peak near 3.5% around mid‑next year. The kiwi is down about 1% so far this week, on track for its first weekly decline in four.