Early Wednesday morning in Asia, news crossed wires that New Zealand Treasury anticipates, while speaking in the Parliament, at least 10% contraction in the second quarter (Q2) GDP YoY figures.

FX implications

In a reaction to the news, NZD/USD stepped back from 0.5975 to 0.5967. The reason for the lack of moves could be traced to the mixed activity numbers from Australia, New Zealand’s largest customer. Additionally, the US dollar also consolidates its latest gains and seems to favor the kiwi pair.

In his latest appearance on Tuesday evening, early Wednesday in Asia, US President Donald Trump issues guidelines for 30-day social distancing while citing fears of a surge in the virus cases during the upcoming two weeks.

Key quotes

We’re going to go through a tough two weeks.

This is going to be a very painful two weeks.

I want all Americans to be prepared for the hard days that lie ahead.

We have held back 10,000 ventilators to handle the expected surge.

Americans need to respond to the coming situation with an ironclad resolve.

FX implications

The news exerts additional pressure on the market’s risk-tone but the early Asian session lacks reaction. Even so, Wall Street closed on the negative and the US stock futures are also suggesting further declines by the press time.