NZD/CAD forecast March 2025: The Truth About Rate Changes

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NZD/CAD forecast

NZD/CAD Forecast March 2025, the NZD/CAD currency pair is trading at approximately 0.827.  This exchange rate reflects recent market dynamics influenced by global trade tensions, monetary policy shifts, and evolving market sentiment.

Fundamental Analysis: Trade Tensions and Interest Rate Policies

Trade Tensions Impacting NZD/CAD forecast

The United States has recently imposed tariffs on Canadian goods, contributing to a risk-off sentiment in global markets. While New Zealand is not directly affected by these tariffs and maintains a limited trade relationship with the U.S., the broader uncertainty can influence commodity-linked currencies like the NZD and CAD.

Monetary Policy Divergence

Both the Reserve Bank of New Zealand (RBNZ) and the Bank of Canada (BoC) are currently in monetary easing cycles, having reduced interest rates to support their economies. This convergence in monetary policies suggests that interest rate differentials may have a muted effect on the NZD/CAD pair in the short term.

Technical Analysis: Key Support and Resistance Levels

For traders focusing on technical indicators, the NZD/CAD chart reveals critical levels:

     

      • Support Level: 0.819, representing the recent low. A decline below this level could signal further downside potential.

       

        • Resistance Level: 0.849, where the pair has encountered resistance previously. A breakout above this level could pave the way for an uptrend toward 0.860 or higher.

      Technical Indicators NZD/CAD forecast

         

          • Relative Strength Index (RSI): Currently around 55, indicating neutral to slightly bullish momentum. Traders should be cautious if the RSI approaches overbought conditions, which could suggest a potential correction.

          • Moving Averages: A bullish crossover between the 50-day and 200-day moving averages has been observed, reinforcing a positive near-term trend for the NZD/CAD pair.

        Sentiment Analysis: CFTC Data and Market Positioning

        According to the latest Commitment of Traders (COT) report from the Commodity Futures Trading Commission (CFTC), non-commercial traders have increased their net long positions in the New Zealand dollar, indicating bullish sentiment.  Conversely, net short positions in the Canadian dollar have risen, reflecting a bearish outlook. This divergence suggests potential upward momentum for the NZD/CAD pair.

        Conclusion: Outlook for NZD/CAD in March 2025

        Considering the current fundamentals, technical signals, and sentiment data, the NZD/CAD pair is expected to maintain a bullish bias throughout March 2025. Traders should monitor ongoing trade developments and central bank communications for any changes that could impact this outlook.

        How do you see NZD/CAD performing in the coming weeks? Share your thoughts and strategies below!

        Update (March 21, 2025): Due to US sanctions on Iran and rising oil prices, our NZD/CAD long trade outlook has changed. Read our latest NZD/CAD forecast update here.

         

         

        Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Trading forex involves significant risk, and you should consult with a licensed financial advisor before making any investment decisions.