New Zealand dollar crashes to historic lows as US bank gains favor
The New Zealand dollar has slumped to levels not seen in years against several major currencies. Investors are turning to the US bank as a safer bet before key economic updates from America. Meanwhile, global currency markets face added pressure from falling Bitcoin prices and shrinking risk appetite.
The Kiwi’s decline has been sharp and widespread. It hit a five-year low on a trade-weighted basis and dropped to a seven-month low against the US bank, trading just under 56 US cents. Against the Australian dollar, it returned to a near 13-year low. The currency also weakened to 13-year lows against the British pound and the Chinese yuan.
New Zealand’s economic struggles are weighing on its currency. Soft dairy prices, a sluggish economy, and expectations of another Reserve Bank rate cut have reduced the Kiwi’s appeal. At the same time, the US bank has strengthened as traders scale back bets on further Federal Reserve rate cuts.
Elsewhere, the Japanese yen continues to slide under Prime Minister Sanae Takaichi’s leadership. Her government, which favours loose monetary policy and low interest rates, now faces growing pressure to intervene. The weak yen has pushed up import costs, straining household budgets. Discussions about possible currency market intervention began after Takaichi’s election win on 4 October 2025, when the yen’s sharp drop raised concerns about volatility.
The New Zealand dollar remains under pressure from both domestic and global factors. Its prolonged weakness reflects economic challenges at home and shifting investor sentiment abroad. For Japan, the yen’s decline has sparked talks of intervention by the US bank, though no concrete steps have yet been taken.
