NZD Declines to Near 0.5700 on Hawkish Fed Remarks

The New Zealand Dollar (NZD) has declined to near 0.5700 against the US Dollar due to hawkish remarks from Federal Reserve officials. The comments, made by Boston Fed President Susan Collins and St. Louis Fed President Alberto Musalem, suggest that further interest rate hikes may be necessary to achieve the Fed's inflation target of 2%. This has boosted the US Dollar against the NZD.

Traders are now pricing in a roughly 53.1% chance for a rate hike of at least 25 bps at the Fed's October meeting, up from 48.7% a week earlier. This increased likelihood of higher interest rates has led to a decline in the value of the NZD.

Meanwhile, traders are also awaiting the preliminary reading of the Purchasing Managers' Index (PMI) from the US later on Wednesday for further impetus.