This morning, New Zealand’s labour market data was released, showing unfavourable results. The unemployment rate rose to 5.1% in Q4, the highest since Q3 2020, signalling economic slowdown and reinforcing expectations of a rate cut by the Reserve Bank of New Zealand at its meeting in late February.

However, the weak labour market figures were widely anticipated and already priced in. A greater source of uncertainty is the ongoing trade war between the US and China, a key trading partner for both Australia and New Zealand.

Donald Trump stated that he is "in no rush" to speak with Xi Jinping after China retaliated against the 10% US tariffs on Chinese imports.

Technical analysis of the NZD/USD chart shows that:

→ The pair remains in a downward trend (marked in red), driven by a strengthening US dollar. The price is currently near the upper boundary of this trend.

→ The 0.555 level acted as support twice in 2025, as indicated by arrows. Notably, the price also reversed upwards from this area in 2022.

It is possible that buyers will gain confidence and attempt to break the upper boundary of the channel. The future trajectory of NZD/USD will largely depend on news related not only to central bank interest rate decisions but also to government actions on tariffs.

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