Kiwi Falls to Eleven-Week Low Amid Hawkish Fed Outlook

The New Zealand dollar is under pressure due to a strong US dollar, reaching an eleven-week low of $0.567 on Thursday.

The greenback's strength can be attributed to stronger-than-expected PMI data, which has fueled concerns over inflation and led to increased expectations for interest-rate hikes by the Federal Reserve.

In fact, several Fed officials had expressed broader concerns about persistent inflation risks before the release of the PMI data, stating that rate increases are likely needed.

The hawkish Fed outlook is overshadowing expectations for further tightening by the Reserve Bank of New Zealand, with markets pricing in a 75% chance of a third hike in October.