What the Big 4 Banks Forecast for the New Zealand Dollar in 2020

A bank forecast for the New Zealand Dollar (NZD USD) usually differs between banks and changes from month to month. This article looks at the general trend in NZD USD forecasts from the big 4 banks and how it might impact you.

2020 New Zealand dollar NZD Forecast

Bank forecasts for the NZ Dollar

The New Zealand Dollar (NZD USD) hit a 10-year low against the US dollar and will likely stay weak in the first half of 2020.

Bank forecasts suggest the NZD currency will only pick up slightly by the end of the year, but this is uncertain with the coronavirus pandemic hitting global economies.

Major banks are expecting global conditions to continue to deteriorate. This could drive the NZD exchange rate even lower than current forecasts.

How will coronavirus affect exchange rates?

Uncertainty from the coronavirus pandemic increases volatility in currency markets. Generally, safe-haven currencies like the USD, CHF and JPY will likely move higher. However, commodity currencies such as the AUD, NZD, CAD and ZAR exchange rates will likely fall.

Check today's NZ Dollar Exchange Rate: Currency Converter and Graph

Updated in March 2020

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New Zealand Dollar forecast in 2019

The NZD exchange rate is much lower than initial major bank forecasts. In fact, even the Reserve Bank of New Zealand (the RBNZ) has got it wrong. The current NZD exchange rate is more than 4% below the RBNZ's previous forecast. Banks predict this weakness to last for the rest of the year and continue into 2020.

Will the NZD get stronger in 2020?

Unlikely. If we're to believe major bank New Zealand Dollar forecast, the NZDUSD will remain weak around current levels of 62 NZ cents to the US dollar. And perhaps move a touch higher at the end of the year.

2020 New Zealand dollar NZD Bank Forecast


Let's examine the 5 most likely reasons the NZ dollar will remain weak at current forecast levels:

  • Coronavirus pandemic impacts New Zealand's economy, plus tourism and imports/exports take a huge hit
  • China’s economic growth slows even more than expected from the coronavirus pandemic, reducing China trade and lowering demand for NZ imports
  • New Zealand's economy continues to slows, the Reserve Bank of New Zealand cut interest rates earlier than expected, devaluing the NZD
  • Economic growth countries outside of New Zealand slow down and inflation only slowly and gradually picks up, increasing the chance of interest rate cuts elsewhere
  • The coronavirus pandemic is controlled, the US economy picks up and the Federal Reserve (central bank) increases interest rates, supporting the USD


How does a weaker NZD affect me?

A weaker New Zealand dollar isn’t great for New Zealanders living in Australia and other places abroad. Those who have moved to overseas locations will see a decline in overall spending power if they're servicing their lifestyles with NZD payments.

If you want to have some certainty for your money transfers even when the New Zealand dollar is weak, you can check out our currency calculator for the best rate.

With the NZD falling, New Zealanders would normally expect an increase in tourists, probably from neighbouring Australia. However, with the coronavirus pandemic in full force, travel plans would be postponed or cancelled indefinitely.

2020 New Zealand dollar NZD Bank Forecast

What are the key influences on the NZD exchange rate?

1. New Zealand Economy

The New Zealand economy is under pressure from the coronavirus pandemic. Domestic economic weakness can lead to a weaker NZD. Unfortunately, a slower global growth environment will also impact the domestic economy negatively.

2020 New Zealand dollar NZD Bank Forecast


2. New Zealand Politics

The political scene in New Zealand has generated uncertainty. Greater uncertainty from politics means investors will sell the NZD. Particularly, if government policies are deemed as ineffective for tackling the coronavirus crisis or unable to stimulate economic growth.

3. Other Currencies

The US dollar (USD) has a significant influence on the New Zealand Dollar. Generally, when the USD gets stronger, the NZD is relatively weaker and vice versa.

NZD to USD Exchange Rate Calculator

Today's rate

NZD bank forecast currency pairs

2020 New Zealand dollar NZD to Euro Bank Forecast

NZD to GBP forecast

The NZD GBP cross rate will largely be at the whim of Brexit developments and will therefore continue to be volatile near-term. Currently the NZD GBP is trading around 0.4946. Longer term outlooks suggest the NZD GBP currency pair could remain around 50 cents by the end of 2020.

Related Article: British Pound GBP Bank Forecast 2020

2020 New Zealand dollar NZD to Australian Dollar AUD Bank Forecast

NZD to AUD forecast

The NZD AUD exchange rate has been choppy since the beginning of the year, currently settling around 0.9500. For 2020, the major banks are expecting the NZD AUD to stay around 95 NZ cents to the Aussie dollar or move slightly lower.

Related Article: Australian Dollar AUD Bank Forecast

2020 New Zealand dollar to Euro EUR Bank Forecast

NZD to EUR forecast

The NZD EUR cross rate has fallen 5% to about 0.5800 from the 2019 high near 0.6087 reached in March. Unfortunately, major banks think the NZD EUR cross rate could fall again in 2020, towards 0.5500 by the end of the year.

Related Article: Euro EUR Bank Forecast 2020

Where to find the best NZD cash rate

In Australia, the best cash rates are found in major cities. We regularly check the main money changers in each CBD to find out the best forex exchange rates for New Zealand Dollars in town.

How to track down the best cash rate

You can either walk around to each money changer, try and call each one and check their rate or you can use our city and suburb guides:

Compare international money transfer exchange rates

General advice: The information on this site is of a general nature only. It does not take your specific needs or circumstances into consideration. You should look at your own personal situation and requirements before making any financial decisions.