The New Zealand dollar rose to $0.591 on Wednesday, ending a two-day decline, as the US dollar continued to struggle amid higher prospects of interest rate cuts by the Federal Reserve. Mounting concerns about the US economy - particularly signs of a cooling labor market - have bolstered bets on a September rate cut. However, the kiwi's gains may be capped by weak domestic economic data. New Zealand’s unemployment rate ticked up to a near five-year high of 5.2% in Q2, from 5.1% in Q1, though it was slightly better than the expected 5.3%. The data indicated that the labor market remains soft, reinforcing expectations that the Reserve Bank of New Zealand may cut rates at its next meeting in August. Markets now price in a 90% chance 5bps cut, with the potential for further easing to a floor of 2.75% later this year or early next. Adding to concerns, the Trump administration imposed 15% tariffs on New Zealand exports, effective August 7, which could weigh on the country’s export-driven economy.