- Trump confuses investors over Iran peace deal
- Markets remain hopeful despite uncertainty
- NZD expected to be most volatile G10 currency this week
- RBNZ expected to leave rates unchanged
- Bloomberg FX model - 73.2% - (0.5802 - 0.5958)
Another weekend, another Trump plot twist…
True to form, the President kept investors on edge with the latest chapter of the US-Iran saga.
Officials say a deal is close. One that would reopen the Strait of Hormuz and let Iran sell its oil again in exchange for a 60-day ceasefire extension.
Except it leaves out Iran’s missile stockpiles and uranium enrichment – two things Trump has called dealbreakers.
Nevertheless, markets seem hopeful. When trading opened Sunday, sharp gaps from Friday's close reflected this sentiment.
WTI: ↓ 5%
BRENT: ↓ 4.5%
USDInd: ↓ 0.5%
XAUUSD: ↑ 1.5%
Note: Performance shown represents the gap from Friday’s close.
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NZDUSD set for wild Wednesday?
DID YOU KNOW…
The NZD is expected to be the MOST volatile G10 currency versus the USD this week!
WHY:
The Kiwi (NZD) is viewed as a proxy for global economic sentiment which has been rocked by the Iran war.
The Reserve Bank of New Zealand (RBNZ) interest rate decision later this week.
WHAT COULD MOVE NZDUSD THIS WEEK?
Reserve Bank of New Zealand (RBNZ) rate decision – (02:00 AM UTC) - Wednesday, May 27th
The central bank is widely expected to cut interest rates by 25 basis points on Wednesday with traders pricing in 3 rate hikes in 2026.
Note: Over the past 12 months, the RBNZ decision has triggered upside moves of as much as 0.8% or declines of 1.0% in a 6-hour window post-release.
US April PCE report – (12:30 PM GMT) - Thursday April 28th
Note: Over the past 12 months, the US CPI report has triggered upside moves on the NZDUSD of as much as 0.7% or declines of 0.5% in a 6-hour window post-release.
POTENTIAL SCENARIOS:
The NZDUSD is hovering above key support at 0.5850.
BULLISH – A move above the 100-day SMA may open a path toward 0.5960 and 0.6000.
BEARISH – A breakdown below 0.5850 could see a decline toward the 200-day SMA at 0.5835 and 0.5800 - the lower limit of the Bloomberg FX model.