New Zealand pacer Mitchell McClenaghan struck early to give England first blow as he dismissed Ian Bell in third over.
England suffered another jolt in quick succession when Kyle Mills removed Jonathan Trott.
Earlier, heavy rains reduced the key match to a 24 overs per side contest.
After New Zealand had won the toss and elected to field, the rain started and the covers were put in place.
Whichever team wins this match will go through to the semifinals and if hosts England lose they will exit the tournament.
But if New Zealand lose they will be involved in a three-way battle for a semifinal place with Australia and Sri Lanka, who meet in the last Group A match at The Oval on Monday.
If Sunday's match is a washout, New Zealand will go through to the last four and if Sri Lanka win on Monday they too will qualify for the knockout stages.
A washout in Cardiff means defending champions Australia will both need to beat Sri Lanka and to improve their net run-rate to edge past England.
In order for a result to be declared both teams in a match must bat for a minimum of 20 overs each.
If both remaining Group A matches do end as no result washouts, England will qualify behind New Zealand on run-rate.
Bad weather in Cardiff saw Friday's Group B match between South Africa and the West Indies end in a tie under the Duckworth/Lewis method for rain-affected fixtures.
The tie saw South Africa into the semifinals at West Indies' expense on net run-rate.
Although Sunday's start was delayed, the toss did take place as scheduled and New Zealand captain Brendon McCullum asked England to bat first.
England were without Graeme Swann because of a calf injury, which followed a back problem he suffered earlier in the tournament, and his place was taken by fellow off-spinner James Tredwell.
However, top order batsman Jonathan Trott was passed fit following a leg injury that prevented him fielding for most of Sri Lanka's innings during England's seven-wicket defeat at The Oval on Thursday.
New Zealand seamer Tim Southee was ruled out with an ankle injury and in his place the Black Caps gave a one-day international debut to 22-year-old left-arm paceman Corey Anderson, who played three Twenty20 internationals in South Africa last year.
Anderson was a late call-up after replacing Grant Elliott in the New Zealand squad for the tournament after the all-rounder was ruled out after exacerbating a left calf injury during a training session in Cardiff on Saturday.
The Group A winners will play South Africa in the first semifinal at The Oval on Wednesday, with the runners-up facing India in Cardiff on Thursday.
The Champions Trophy final takes place at Edgbaston on June 23.
There are no reserve days in the tournament. If a semifinal is washed out, the team who topped its group will go through.
If the final is washed out, the trophy will be shared.
Teams:
England: Alastair Cook (capt), Ian Bell, Jonathan Trott, Joe Root, Eoin Morgan, Ravi Bopara, Jos Buttler (wkt), Tim Bresnan, Stuart Broad, James Tredwell, James Anderson
New Zealand: Luke Ronchi (wkt), Martin Guptill, Kane Williamson, Ross Taylor, Brendon McCullum (capt), James Franklin, Daniel Vettori, Nathan McCullum, Corey Anderson, Kyle Mills, Mitchell McClenaghan
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