NZD\/USD trades around 0.5870 on Monday at the time of writing, down 0.11% on the day. The New Zealand Dollar (NZD) edges lower after weaker-than-expected economic data from China, while investors remain primarily focused on developments surrounding talks between Washington and Tehran and upcoming US economic releases.<\/p>\n
Data released by RatingDog showed that China’s Manufacturing Purchasing Managers Index (PMI) slowed to 50.9 in July from 51.7 in June, missing the market consensus of 51.5. Despite the downside surprise, the reaction in the Kiwi remains limited as traders prioritize geopolitical developments.<\/p>\n
United States (US) President Donald Trump said that a new round of talks with Iran would begin on Monday afternoon after suspending planned military strikes following appeals from several Middle Eastern allies. According to Bloomberg, the decision comes as Washington seeks to revive negotiations over Iran’s nuclear program.<\/p>\n
However, Iranian officials rejected Trump’s statements, describing them as “another lie” and saying the country’s armed forces remain on high alert, according to the Mehr news<\/a> agency. The conflicting messages continue to keep investors cautious.<\/p>\n Any progress toward an agreement between the two countries could improve risk sentiment and support growth-sensitive currencies such as the New Zealand Dollar (NZD). On the other hand, renewed escalation in the Middle East would likely boost demand for the safe-haven US Dollar (USD).<\/p>\n Market sentiment is also being influenced by the Organization of the Petroleum Exporting Countries and its allies (OPEC+) decision to increase production in September, which has contributed to lower Oil prices and slightly reduced expectations of tighter monetary policy from the Federal Reserve<\/a> (Fed). This development is limiting the upside potential of the US Dollar.<\/p>\n Investors now await the release of the Institute for Supply Management (ISM) Manufacturing PMI<\/a> later on Monday before turning their attention to Friday’s July Nonfarm Payrolls (NFP) report. These releases could provide fresh clues on the Fed’s policy outlook<\/a> and help determine the next direction for NZD\/USD.<\/p>\n RBNZ outlook underpinned by steady labor data and firmer NZD support<\/p>\n Strategists at Brown Brothers Harriman expect New Zealand\u2019s second-quarter labor market report, due Tuesday, to show continued stability, broadly in line with the RBNZ\u2019s May projections. They look for \u201cemployment \u2026 to rise 0.1% q\/q vs. 0.1% in Q1, the unemployment rate \u2026 at 5.4% vs. 5.3% in Q1, and private regular wages \u2026 at 0.6% q\/q vs. 0.5% in Q1.\u201d<\/p>\n