NZD Weakens Amid Inflation Fears and Fed Rate Hike Expectations

The New Zealand dollar has weakened to around $0.59 on Tuesday, its lowest level in two weeks, due to cautious investor sentiment and concerns over higher inflation.

Global bond yields have reached multi-decade highs, fueled by expectations of a Federal Reserve interest-rate increase later this month, which is curbing appetite for riskier assets.

The Reserve Bank of New Zealand is expected to raise its official cash rate by 25 basis points to 2.75% on Wednesday, but markets anticipate the OCR to reach around 3% by December and 3.5% next year.