NZD/USD rises near 0.6035 as US dollar weakens
The NZD/USD pair moved above the key 0.6000 mark and touched around 0.6035 in early Asian trading on Wednesday.
This upward move came as the US dollar lost some strength, helping the New Zealand dollar gain support.
Market confidence in a rate cut from the Reserve Bank of New Zealand (RBNZ) has reduced. This has added more support to the NZD.
The pair has been moving in a narrow range for the past two weeks, as traders wait for the outcome of the Federal Reserve’s two-day meeting.
The Fed is expected to keep interest rates unchanged, but all eyes are on Fed Chair Jerome Powell’s comments. Investors are looking for hints about when rate cuts might begin.Many believe the Fed could start cutting rates in September. This expectation is putting pressure on the US dollar.
At the same time, the RBNZ is likely to make only one more rate cut, which gives the NZD additional strength.
However, global uncertainties, including tensions in the Middle East and possible trade issues, are keeping traders cautious.NZD/USD needs to break the resistance zone around 0.6065–0.6070 for more gains to happen.
Impact: NZD/USD might move higher if the Fed sounds dovish, but rising global risks or delays in US rate cuts could slow down the rally.