NZD/USD trades near 0.6100 after trimming losses amid hawkish RBNZ

Source Fxstreet
May 24, 2024 04:38
  • NZD/USD pares daily losses amid hawkish comments from RBNZ officials on Friday.
  • Strong PMI data pushed US yields higher, bolstering the Greenback.
  • The improved Kiwi Consumer Confidence could limit the losses of the New Zealand Dollar.

NZD/USD received pressure due to the emergence of the risk aversion sentiment after the higher-than-expected Purchasing Managers Index (PMI) data from the United States (US) was released on Thursday. The data reinforced the hawkish sentiment surrounding the Federal Reserve (Fed) of maintaining higher policy rates for an extended period. The NZD/USD pair trades around 0.6100 during the Asian session on Friday.

The S&P Global US Composite PMI rose to 54.4 in May from April's 51.3, marking the highest level since April 2022. The index exceeded market expectations of 51.1. The Service PMI surged to 54.8, indicating the biggest output growth in a year, while the Manufacturing PMI increased to 50.9.

Additionally, the latest Federal Open Market Committee (FOMC) Minutes suggested that Fed policymakers expressed concerns about the lack of progress on inflation, which was more persistent than expected at the start of 2024.

Investors are expected to closely monitor US Durable Goods Orders on Friday, which assess the worth of orders received by manufacturers for durable goods meant to last for three years or more. Additionally, the Michigan Consumer Sentiment Index will offer insight into consumer attitudes toward financial and income situations in the United States.

In New Zealand, the ANZ – Roy Morgan Consumer Confidence rose to 84.9 in May from April’s 82.1, yet it remains relatively low, staying close to values observed during the pandemic response. While this uptick in data may have offered some support for the New Zealand Dollar (NZD), limiting the downside of the NZD/USD pair.

Deputy Governor Christian Hawkesby of the Reserve Bank of New Zealand (RBNZ) stated on Friday that "cutting interest rates is not part of the near-term discussion." Additionally, RBNZ Assistant Governor Karen Silk expressed concern about near-term inflation risks, noting that the bank has adjusted its modeling after underestimating domestic inflation strength.

In an interview with Bloomberg on Thursday, Governor Adrian Orr played down the likelihood of another interest rate hike, indicating that the bank would only tighten policy further if necessary to contain inflation expectations. Orr also mentioned that the central bank could consider easing before inflation reaches 2%.

NZD/USD

Overview
Today last price 0.6097
Today Daily Change -0.0002
Today Daily Change % -0.03
Today daily open 0.6099
 
Trends
Daily SMA20 0.603
Daily SMA50 0.6003
Daily SMA100 0.6071
Daily SMA200 0.6042
 
Levels
Previous Daily High 0.6138
Previous Daily Low 0.6091
Previous Weekly High 0.6146
Previous Weekly Low 0.5995
Previous Monthly High 0.6079
Previous Monthly Low 0.5851
Daily Fibonacci 38.2% 0.612
Daily Fibonacci 61.8% 0.6109
Daily Pivot Point S1 0.6081
Daily Pivot Point S2 0.6062
Daily Pivot Point S3 0.6033
Daily Pivot Point R1 0.6128
Daily Pivot Point R2 0.6157
Daily Pivot Point R3 0.6175

 

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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