New Zealand Dollar Edges Lower
New Zealand dollar slips to $0.587 as US dollar edges higher
The New Zealand dollar slipped to around $0.587 as the US dollar edged higher, with investors awaiting US inflation data for fresh clues on the Federal Reserve’s interest-rate path.
A hotter-than-expected CPI reading could reinforce expectations for tighter US monetary policy, boosting the greenback.
On the domestic front, markets remain set on a rate increase from the Reserve Bank of New Zealand in September after the central bank signalled that further tightening may be needed to remove monetary stimulus and keep inflation under control.
However, last week’s soft jobs data has raised questions about how aggressively the RBNZ can continue raising rates.
Meanwhile, uncertainty over the prospects for a Middle East peace deal that could reopen the Strait of Hormuz weighed on market confidence.
In other news, NZ Prime Minister Christopher Luxon said that he survived a leadership vote among his own party’s lawmakers less than three months before an election.