Reuters cited trade experts and those close to US President Donald Trump as saying signing the deal could be pushed into 2020 as China seeks more extensive tariff rollbacks.
That's with another round of US tariffs on Chinese imports set to take effect from December 15.
"Essentially, the market's pretty disappointed that they're going to kick the can down the road into next year where it will possibly run into interference from the US election," says Martin Rudings, an adviser at OMF.
Nevertheless, the domestic currency is being supported by receding expectations the Reserve Bank will cut interest rates again – it left its official cash rate unchanged at 1 per cent at its last meeting on November 13.
"It's still a bit sticky because of no rate cut the RBNZ gave us," Rudings says.
The market is now pricing in only a 20 per cent chance of a rate cut at RBNZ's next meeting on February 12 and hasn't fully priced in a cut for all of next year, he says.
By contrast, the market has priced in a 50 per cent chance of the Reserve Bank of Australia cutting its cash rate in February.
Rudings says the market needs confirmation on the US-China trade front.
"My guess is equities markets will come off quite hard but, unless we know, the New Zealand market's going nowhere."
The likelihood of a trade deal has also been complicated by both chambers of the US congress passing a bill supporting human rights in Hong Kong after months of anti-government protests in the autonomous Chinese territory.
While Trump hasn't signed the bill yet to pass it into law, it was supported by near-unanimous votes so congress could override a presidential veto.
The New Zealand dollar was trading at 94.25 Australian cents from 94.33, at 49.56 British pence from 49.64, at 57.85 euro cents from 57.91, at 69.54 Japanese yen from 69.62, and at 4.5108 Chinese yuan from 4.5105.
The two-year swap rate edged down to a bid price of 1.1200 per cent from 1.1250 per cent yesterday while 10-year swaps rose to 1.4625 per cent from 1.4575 per cent.
