Forex

NZD Falls as Fed Hawkishness Boosts Rate Hike Odds

Guavy AI Editorial Team Published September 18, 2026

Instruments

USD NZD

The New Zealand Dollar (NZD) fell against the US Dollar (USD) on Friday, after posting gains the previous day. The pair lost ground due to hawkish comments from Federal Reserve Chair Kevin Warsh, which boosted interest rate expectations.

Warsh highlighted that inflation remains uncomfortably high and noted that recent economic data has not reflected meaningful structural progress. As a result, market participants are now pricing in a 53.1% probability of a rate hike at the October Fed meeting, up from 44% the previous day.

However, strategists at ING suggest that moderating oil prices have taken some edge off the Dollar's momentum, with energy markets drawing support from political developments. Trump's reported meeting with Gulf States may provide clarity on plans for the region and impact regional risk sentiment.

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