NZD/USD falls to near 0.5750 ahead of US CPI data
The post NZD/USD falls to near 0.5750 ahead of US CPI data appeared on BitcoinEthereumNews.com.
NZD/USD extends its losses for the second successive session, trading around 0.5760 during the early European hours on Thursday. The pair weakens as the New Zealand Dollar (NZD) comes under pressure, even after data revealed stronger-than-expected economic growth. New Zealand’s Gross Domestic Product (GDP) grew 1.1% quarter-over-quarter (QoQ) in the third quarter, beating expectations of 0.9%. Growth rebounded from a 1.0% contraction (revised from -0.9%) in Q2. On an annual basis, GDP expanded 1.3% YoY in Q3, recovering from a 1.1% decline (revised from -0.6%) in Q2 and matching market expectations. However, substantial spare capacity persists in the economy, indicating that the recent pickup in growth is unlikely to generate inflationary pressures in New Zealand over the year ahead. As a result, expectations for a near-term rate hike by the Reserve Bank of New Zealand (RBNZ) have eased. Markets now price in a 40% chance of a rate increase by July next year, down from about 50% before the data release. The NZD/USD pair also faces challenges as the US Dollar (USD) holds ground amid market caution ahead of the release of the delayed US Consumer Price Index (CPI) report later in the day, which is expected to provide further insight into how price pressures are evolving. Federal Reserve (Fed) Governor Christopher Waller, who is under consideration to become chair of the central bank, reiterated his dovish stance on interest rates during a CNBC forum. “Because inflation is still elevated, we can take our time – there’s no rush to get down. We can steadily bring the policy rate down toward neutral,” Waller said. The CME FedWatch tool suggests that Fed funds futures are pricing an implied 75.6% chance of a hold in rates at the US central bank’s next meeting in January, up from nearly 74% a week ago.…
