Tariff uncertainty continues to rise, and the Australian and New Zealand currencies are under pressure to hit a new low in nearly two weeks

The Australian and New Zealand dollars appeared to be struggling at the start of the week as investors waited with bated breath for an uncertain shock from US trade policy. Meanwhile, the central banks of Australia and New Zealand are set to announce key policy decisions this week, which will undoubtedly add more uncertainty to the market. Delays in the implementation date of tariffs, approaching central bank interest rate decisions, and sluggish performance in Asian stock markets make up a complex picture of the current ANZ foreign exchange market.

The Australian dollar is under pressure: falling to a near two-week low, resistance levels are difficult to break through

The Australian dollar fell as much as 0.73 per cent to 0.6500 against the US dollar in Asian trading on Monday, its lowest level since June 25. Last week, the Aussie rallied just 0.3 per cent and encountered strong resistance at an eight-month high of $0.6590. The existence of this resistance level indicates that the market has reservations about the bullish momentum of the Aussie dollar.

Investors appear to be concerned about the uncertain global economic environment, particularly the impending imposition of tariffs by the United States, which has significantly suppressed the upside of the Australian dollar in the short term.

Nonetheless, the Aussie's overall performance was driven by domestic economic data and central bank policy expectations, which were further overshadowed by widespread expectations that the Reserve Bank of Australia would adopt a more accommodative monetary policy at its policy meeting on Tuesday.

New Zealand dollar slumps: Lowest in nearly two weeks, denting market confidence

Similar to the Australian dollar, the New Zealand dollar was also weak against the dollar on Monday, falling as much as 0.74% to $0.6005, hitting a near two-week low. Last week, the New Zealand dollar only inched up 0.1%, encountering insurmountable resistance at a nine-month high of $0.6120.

The weak performance of the New Zealand dollar reflects the market's cautious attitude towards the outlook for the New Zealand economy, especially as the uncertainty of the global trade environment poses a potential threat to the export-dependent New Zealand economy. In addition, the Reserve Bank of New Zealand (RBNZ) will hold a policy meeting on Wednesday, and the market generally expects its official overnight lending rate (OCR) to remain unchanged at 3.25%. Interest Rate Swap puts this probability as high as 81%. Against the backdrop of sluggish global risk sentiment, the short-term trend of the New Zealand dollar may continue to be suppressed.