Safe-haven demand lifts the USD amid Middle East tensions, pressuring the New Zealand Dollar despite stalled NZD/USD declines.
NZD/USD trades at 0.5880, down 0.03% on Tuesday, as the US Dollar gains from safe-haven flows tied to geopolitical uncertainty in the Middle East. The Strait of Hormuz remains a focal point, with Qatar reporting advanced negotiations between Iran and Oman but cautioning that talks are at a critical stage.
Oil prices have risen over 6% this week, with WTI trading around $82.10, fueling inflation concerns and supporting higher US Treasury yields. Iran’s conditions for reopening the strait—including sanctions relief and war reparations—add to the uncertainty, while Tehran rules out direct talks with the US before 2029.
Investors are pricing in potential US monetary tightening as energy costs and yields climb, weighing on risk-sensitive currencies like the NZD.