2026.07.1301:51:19UTC+00Kiwi Dollar Near 3-Week Highs

The New Zealand dollar traded around $0.576 on Monday, hovering near its highest level in more than three weeks, supported by expectations of further interest rate increases from the Reserve Bank of New Zealand. Interest rate swaps are now pricing in nearly two additional 25-basis-point hikes by year-end, following the central bank’s hawkish tone and stronger-than-expected manufacturing data last week. Sentiment was further bolstered by fresh figures showing that New Zealand’s services sector returned to expansion in June for the first time since January, reinforcing the view that the economy is regaining momentum. However, escalating tensions in the Middle East are dampening risk appetite and capping gains in the kiwi. Over the weekend, the US and Iran exchanged heavy missile and drone strikes, with Tehran targeting US facilities across the Gulf and claiming once again to have closed the Strait of Hormuz.