Kiwi Holds Firm on US Dollar Sell-Off

The New Zealand dollar has continued its upward momentum, hovering around $0.593 after gaining 1% in the previous session to reach a two-and-a-half-month high.

This increase can be attributed to the decline of the US dollar and Treasury yields retreating from multi-year highs.

The US Treasury announced plans to double its buybacks of longer-dated government debt, aimed at improving liquidity and stabilizing the bond market.

This move has resulted in a decrease in US yields, providing some relief for risk-sensitive currencies despite ongoing uncertainty surrounding the Middle East conflict.

However, policymakers from the Federal Reserve remain concerned about persistent inflation, with several officials open to further interest-rate hikes, which could potentially limit the New Zealand dollar's upside.