NZD/USD gathers strength to near 0.5950 as Trump extends China tariff deadline by another 90 days

• NZD/USD edges higher to near 0.5940 in Tuesday's early Asian session.
• Trump announced another 90-day pause on China tariffs.
• The US CPI inflation report for July will take center stage later on Tuesday. 

The NZD/USD pair gains ground to around 0.5940 during the early Asian session on Tuesday. The New Zealand Dollar (NZD) strengthens against the Greenback after US President Donald Trump extends the China tariff deadline by another 90 days. Traders will keep an eye on the US July Consumer Price Index (CPI) report, which is due later on Tuesday. 

Reuters reported late Monday that the Trump administration agreed to delay implementing sweeping tariffs on China, extending another 90 days just hours before the last agreement between the world's two largest economies was due to expire. 

Meanwhile, China's Commerce Ministry announced that the country will suspend additional tariffs on US goods for 90 more days, after Trump signed an executive order extending the tariff truce. Positive trade outcomes provide some support to the China-proxy Kiwi, as China is a major trading partner of New Zealand. 

However, the concerns over persistent deflationary pressure in China might cap the upside for the NZD. Data by the National Bureau of Statistics (NBS) on Saturday showed China's Producer Price Index (PPI) fell more than expected in July. This report suggested the impact of sluggish domestic demand and ongoing trade uncertainty on consumer sentiment.

Traders will shift attention to the US CPI inflation report later in the day, which offers some cues about the US interest rate path this year. The headline CPI is estimated to show an increase of 2.8% YoY in July, while the core CPI is projected to show a rise of 3.0% YoY during the same report period. In case of a hotter-than-expected outcome, this could underpin the USD and create a headwind for the pair.