NZD/USD Falls Below 0.5900 on Strong US Jobs Data
The NZD/USD pair has fallen below 0.5900 and is currently trading at around 0.5875, pressured by a stronger US Dollar following the release of strong US jobs data.
The August US Nonfarm Payrolls (NFP) rose to 162K, surpassing market expectations of 56K, while the Unemployment Rate remained steady at 4.1%.
This has led to increased bets on a US Federal Reserve rate hike in September, with Fed funds futures pricing in around a 60% probability of a hike according to the CME FedWatch tool.
The Reserve Bank of New Zealand (RBNZ) raised its Official Cash Rate (OCR) by 25 basis points last week, but analysts at Commerzbank note that this was a widely anticipated move and that the RBNZ continues to tighten monetary policy gradually in response to inflation risks.