NZD/USD declines to near 0.5980 as USD turns positive

The NZD/USD pair is down 0.2% to near 0.5980 during the European trading session on Thursday. The Kiwi pair is under pressure as the US Dollar (USD) turns positive ahead of the United States (US) market opening.

As of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades marginally higher to near 97.70.

Earlier in the day, the US Dollar opened lower as uncertainty surrounding the United States (US) trade policy outlook continued to linger. However, the uncertainty still persists as investors worry that Washington’s trading partners, who have signed trade deals, could compel the White House for a revision in the wake of the Supreme Court’s (SC) ruling against President Donald Trump’s tariff policy.

To mitigate the same, Washington has announced 10% global tariffs, and guidance that the import duty could be increased to 15% or above on some countries.

On the monetary policy front, Federal Reserve (Fed) officials have been guiding that the current monetary policy state is appropriate to balance job and inflation risks.

Meanwhile, the New Zealand Dollar (NZD) trades lower on diminishing expectations that the Reserve Bank of New Zealand (RBNZ) will not hike interest rates in the near term. Hawkish RBA prospects have squeezed as Governor Anna Breman said in the monetary policy announcement last week that the economy could continue to grow without triggering inflationary pressures.