The New Zealand dollar fell 0.4% to $0.5687 on Monday, erasing much of the momentum from a 1.3% rally the previous week that had lifted the currency to $0.5727.
The pullback reflects cautious positioning ahead of the Reserve Bank of New Zealand’s upcoming policy announcement, which markets view as a critical test of the central bank’s stance amid shifting economic data.
Earlier in the week, the New Zealand dollar had touched a 2½-month low of $0.
The kiwi’s retreat follows a period of sustained pressure on commodity currencies.
Earlier in the week, the New Zealand dollar had touched a 2½-month low of $0.5702, marking its fifth consecutive session of declines.
That sell-off was largely driven by a broad-based surge in the US dollar, which has weighed on risk-sensitive assets globally.
While the currency managed a brief rebound last week, Monday’s slide suggests that underlying headwinds remain intact.