During December 29, after the system had stalled, Zoe started to move towards the southeast in response to the strengthening steering flow, provided by an upper level trough of low pressure and a baroclinic system near New Caledonia. Over the next couple of days the system rapidly weakened under the influence of: strengthening vertical wind shear, dry air and cooler sea surface temperatures. During December 31, as the system continued its southeastwards movement, it passed about to the southwest of Nadi, Fiji as a Category 2 tropical cyclone. By this time the system was transitioning into an extra tropical cyclone, while deep convection surrounding the system had significantly diminished. As a result of further weakening, the JTWC issued their final warning on Zoe during January 1, 2003, while the FMS reported that Zoe had weakened into a tropical depression. The system was subsequently recurved and started to move towards the southwest during January 2, before it was declared extratropical as it interacted with an extratropical low which was located over the Tasman Sea. Zoe was subsequently last noted by the FMS during January 4, while it was located about to the southeast of Noumea, New Caledonia.