NZD/USD treads water above 0.5700, as the risk-off mood holds bulls

• The Kiwi Dollar is looking for direction about 0.5700, with upside attempts limited below 0.5750
• Concerns about a Sino-US trade war are hurting the China-proxy NZD.
• The protracted US shutdown and rising bets of back-to-back Fed rate cuts keep the pair supported.

The New Zealand Dollar recovery attempt from six-month lows at 0.5685 has remained limited at the lower range of the 0.5700s, which leaves the pair practically unchanged on the week, and the broader bearish trend intact.

The Kiwi has been unable to take advantage of the US Dollar weakness, weighed down by the sour market sentiment, as the trade tensions between the US and China, New Zealand's main trading partner, escalate to a boiling point

Fears of a US-China trade war are also hurting the NZD

The Sino-US rift reached a new stage this week after President Trump affirmed that the country is already in a trade war with China, and Treasury Secretary Scott Bessent attacked the Chinese trade negotiator to make matters worse.

Apart from that, the US government shutdown entered its third week without hopes of any near-term solution, while the Federal Reserve keeps sending signals of further rate cuts ahead, which is keeping the pair from depreciating further.

In New Zealand, the calendar has been light this week, but the Kiwi is still weighed by the unexpected jumbo -50 basis points- rate cut by the Reserve Bank of New Zealand and the downbeat business activity data released afterwards.