According to Jinshi.com, Lenny Jin, global foreign exchange strategist at HSBC, said that the New Zealand dollar is facing more and more unfavorable factors and is expected to perform poorly against safe-haven currencies (especially the US dollar) in the short term.

Jin said in a note that headwinds include a hawkish repricing of Federal Reserve rates, geopolitical escalation and a more dovish-than-expected Reserve Bank of New Zealand.

The Reserve Bank of New Zealand cut its cash rate by 50 basis points today, causing the New Zealand dollar to plummet. Jin believes that the Reserve Bank of New Zealand may have announced its version of "policy easing".

The Reserve Bank stressed that it was trying to avoid unnecessary instability in interest rates and exchange rates, which Jin said could be seen as a dovish signal. With the official cash rate still well above most neutral estimates, markets could be pricing in a series of 50 basis point cuts, or even a 75 basis point cut.