The New Zealand Dollar (NZD) has rebounded against the US Dollar (USD) during Thursday's London trading session, recovering most of its earlier losses and trading above 0.5890, nearing two-week highs at 0.5913 as of the time of writing [1]. This recovery comes as concerns about fresh hostilities between the US and Iran, which had earlier boosted the US Dollar and oil prices during the Asian session, have begun to abate. Investors are now maintaining hopes for a negotiated end to the conflict, leading to a softer Greenback in European trading [1].
On the domestic front, New Zealand's budget, released earlier on Thursday, revealed a projected financial deficit of NZD 11.4 billion for the 2026/27 financial year, which is little changed from previous estimates. Treasury forecasts indicate that this shortfall is expected to halve in the coming year and return to a surplus by 2028/29 [1].
From a technical perspective, NZD/USD is trading at 0.5893, holding above previous highs in the 0.5680 area. The 4-hour Relative Strength Index is around 60, having bounced from the key 50 line, and the MACD indicator shows a slightly positive reading, suggesting gently improving momentum. Resistance levels are identified at 0.5920, with further resistance near 0.5970 and above 0.5990, while support is seen at 0.5864 and, if breached, could lead to a retest of the 0.5815-0.5830 area and potentially the April 13 low at 0.5800 [1].
CONCLUSION
The NZD/USD pair has shown resilience, rebounding toward two-week highs as geopolitical tensions ease and New Zealand's fiscal outlook improves. Technical indicators point to a moderately positive bias, with key resistance and support levels in focus for traders. Market sentiment appears cautiously optimistic amid hopes for a negotiated resolution to US-Iran tensions and improving fiscal forecasts for New Zealand.