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NZD/USD slips after weaker New Zealand retail sales data

New Zealand Retail Sales fell 0.5% in the second quarter versus a 0.1% increase expected, while Iran-linked US secondary sanctions expectations kept risk sentiment cautious.

Reported · Written up by our desk · Major Pairs

The New Zealand dollar pulled back after weaker-than-expected domestic consumption data, with NZD/USD trading around 0.5960 and down 0.25% on the day after nearing 0.6000 on Friday, according to FXStreet.

The data showed New Zealand Retail Sales contracted 0.5% in the second quarter, marking the first decline in nearly two years and following a 0.1% rise in the prior quarter, suggesting household consumption momentum is fading.

FXStreet said the soft retail sales figure is negative for the New Zealand economy and could strengthen arguments for the Reserve Bank of New Zealand to take a less hawkish approach to monetary policy.

Meanwhile, geopolitical concerns tied to Iran and expectations of expanded US secondary sanctions weighed on broader market sentiment, with the US Treasury Department expected to broaden the scope of sanctions targeting entities doing business with Iran, including measures that could exclude affected parties from the US dollar-based financial system.

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