NZD/USD extends its upside above 0.6200 on the softer USD, Fed rate cut bet

NZD/USD gains ground near 0.6210 on the USD weakness.
New Zealand’s Terms of Trade Index for the third quarter (Q3) fell 0.6% QoQ vs. 0.3% prior.
Fed Chair Jerome Powell said it was premature to rule out additional rate hikes or start discussing cuts.

Lallalit Srijandorn FXStreet

The NZD/USD pair gains momentum toward the 0.6200 round figure during the early Asian session on Monday. The speculation that the US Federal Reserve (Fed) could be done with rate hikes drags the US Dollar (USD) lower and lifts the NZD/USD. At press time, the pair is trading near 0.6210, up 0.11% on the day.

Early Monday, New Zealand’s Terms of Trade Index for the third quarter (Q3) fell 0.6% QoQ versus 0.3% prior. Good Export prices dropped 1.5% QoQ from the previous reading of a 6.8% rise while Import prices for goods declined 0.8% QoQ from a 1.0 drop in the previous reading.

The Reserve Bank of New Zealand (RBNZ) held the cash rate steady at 5.5% last week but noted inflation remained too high and that further policy tightening might be needed if price pressures did not ease. That being said, the hawkish tilt from the RBNZ boosts the New Zealand Dollar (NZD) and acts as a tailwind for the NZD/USD pair.

On the other hand, this contrasts with the dovish tone from the Fed, with the market now pricing the US central bank to end the tightening cycle and will begin cutting the rate as early as next March. Fed Chair Jerome Powell stated on Friday that it was premature to rule out additional rate hikes or start discussing cuts.

Apart from this, the US ISM Manufacturing PMI came in weaker than expected and remained unchanged at 46.7 in November, the Institute for Supply Management (ISM) showed on Friday.

Market players will monitor the US Factory Orders for October. Later this week, New Zealand’s ANZ Commodity Price and US ISM Services PMI will be due on Tuesday. The attention will shift to US Nonfarm Payrolls (NFP) on Friday, which is expected to add 180K jobs in November.

NZD/USD

Overview
Today last price	0.6209
Today Daily Change	0.0006
Today Daily Change %	0.10
Today daily open	0.6203

Trends
Daily SMA20	0.6023
Daily SMA50	0.5955
Daily SMA100	0.5986
Daily SMA200	0.609

Levels
Previous Daily High	0.6207
Previous Daily Low	0.6145
Previous Weekly High	0.6208
Previous Weekly Low	0.606
Previous Monthly High	0.6208
Previous Monthly Low	0.5788
Daily Fibonacci 38.2%	0.6183
Daily Fibonacci 61.8%	0.6169
Daily Pivot Point S1	0.6163
Daily Pivot Point S2	0.6123
Daily Pivot Point S3	0.6102
Daily Pivot Point R1	0.6225
Daily Pivot Point R2	0.6247
Daily Pivot Point R3	0.6287

Author

Lallalit Srijandorn

FXStreet

Lallalit Srijandorn is a Parisian at heart. She has lived in France since 2019 and now becomes a digital entrepreneur based in Paris and Bangkok.

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