NZD Hits June Highs as USD Weakens Ahead of August PMI Data
The New Zealand Dollar (NZD) has reached its highest level since early June as it extends its advance against the US Dollar (USD). The NZD/USD pair currently trades at around 0.5980, up 0.62% on the day, and is heading for a solid weekly performance.
The US Dollar remains under pressure due to reduced expectations of an immediate interest rate hike by the Federal Reserve (Fed), despite the relatively hawkish tone maintained in the latest FOMC meeting minutes. The US Dollar Index (DXY) has lost 0.23% to 98.65 on Friday.
The New Zealand Dollar benefits from expectations of another interest rate hike by the Reserve Bank of New Zealand (RBNZ), with investors remaining focused on monetary policy outlook and US Dollar dynamics. Geopolitical risks could limit the Greenback's decline, particularly tensions between the United States and Iran over the Strait of Hormuz.
The preliminary S&P Global US Purchasing Managers Indices (PMIs) for August will be closely watched, with consensus forecasts pointing to a modest slowdown. Weaker-than-expected figures could increase pressure on the US Dollar and continue to support NZD/USD.