New Zealand Prime Minister Christopher Luxon addressed the nation on Tuesday in a parliamentary speech, outlining his vision for unleashing economic growth by 2025. Luxon emphasized the importance of lifting incomes, strengthening local businesses, and creating opportunities for New Zealanders. Concurrently, global financial markets experienced a range of activities, including fluctuations in currency pairs and commodities, that could impact these domestic ambitions.
During his speech, Luxon highlighted the promising signs of economic success already observed in 2024. He noted that inflation had dropped and remained low, interest rates had started to fall, wages were rising faster than inflation, and both business and consumer confidence were on the rise. These factors, he argued, set a strong foundation for future growth in New Zealand.
"Promising signs of success were seen in 2024, such as inflation dropping and remaining low, interest rates starting to fall, wages continuing to rise faster than inflation, and business and consumer confidence rising." – Christopher Luxon, New Zealand Prime Minister.
While Luxon's speech focused on domestic growth, international market dynamics presented both challenges and opportunities. Rebounding US bond yields revived demand for the US Dollar (USD), which weighed on the XAU/USD pair, causing gold prices to struggle despite an overnight bounce from a multi-day trough. The EUR/USD pair retreated further from a one-month peak amid this renewed USD demand, while the GBP/USD pair halted its three-day winning streak due to expectations of an interest rate cut by the Bank of England from 5% to 4.5% at its upcoming meeting.
In contrast to the USD's strength, the New Zealand Dollar (NZD) showed relative weakness. The NZD/USD pair traded around 1.2440 during Tuesday's Asian session, marking the New Zealand Dollar as the weakest against the US Dollar among major currencies. The percentage change of NZD against listed major currencies today reflected this trend.
Elsewhere in the technology sector, several Chinese companies made their artificial intelligence models open source last week. This decision sent shockwaves through the tech sector, potentially reshaping competitive dynamics and innovation trajectories.
Meanwhile, market speculations around policy movements contributed to currency fluctuations. Bets for aggressive policy easing by the European Central Bank (ECB) led to intraday declines in related currency pairs. Additionally, Trump's tariff threats combined with rebounding US bond yields provided notable support to the USD.
In the cryptocurrency arena, JUP's recent buyback and announcement of a 3 billion token burn buoyed its bullish outlook. Such developments underscore the ongoing volatility and investor interest within this digital asset space.