- NZD/USD is expected to witness a downside after the conclusion of the short-lived pullback to near 0.6170.
- Fed policymakers are supporting more conservative monetary policy despite easing US labor market conditions.
- A significant decline in NZ inflation indicates that the RBNZ is well on track of arresting sticky inflation.
The NZD/USD pair is hovering above 0.6170 in the early Asian session after a less-confident recovery move from 0.6150. The Kiwi asset is expected to resume its downside journey below 0.6150 as Federal Reserve (Fed) policymakers are supporting more conservative monetary policy from the central bank despite easing United States labor market conditions.
S&P500 futures are showing nominal gains in the Asian session after three consecutive bearish settlements, indicating that the overall market sentiment is quite negative. US equities faced extreme pressure on Thursday as investors showed dissatisfaction with the price-cutting spree by Electric Vehicle (EV) maker Tesla.
The US Dollar Index (DXY) has been muted after a volatile session on Thursday ahead of the release of the preliminary US S&P PMI data. As per the consensus, the Manufacturing PMI will land at 49.0, lower than the former release of 49.2. The Services PMI is also seen lower at 51.5 against the figure of 52.6 released earlier. A contraction in economic activities indicates a decline in the overall demand, which would cement the expectations of a slowdown ahead.
US weekly jobless claims data, released on Thursday, supported the view of easing labor market conditions. The Department of Labor showed a jump in jobless claims for the week ending April 14 at 245K higher than the consensus of 240K.
Meanwhile, Fed policymakers are still confident of one more rate hike ahead. St. Louis Fed President James Bullard advocated for the continuation of a policy-tightening spell by the central bank considering the fact that labor market data is still solid, as reported by Reuters. Fed policymaker further added that demand for labor has not softened yet and a strong labor market leads to strong consumption.
The New Zealand Dollar remained in action on Thursday after the release of lower-than-anticipated inflation data. In the first quarter, inflationary pressures accelerated by 1.2% vs. the consensus of 1.7% and the former release of 1.4%. Annual inflation softened to 6.7% while the street was anticipating a marginal deceleration to 7.1% from the prior release of 7.2%.
A significant decline in Kiwi inflation indicates that the Reserve Bank of New Zealand (RBNZ) is on the right track to arresting stick inflation. Investors should be aware of the fact that RBNZ Governor Adrian Orr raised interest rates surprisingly by 50 basis points (bps) to 5.25% in its last monetary policy meeting held on April 05.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks

EUR/USD clings to recovery gains below 1.0800
EUR/USD is trading under 1.0800, holding the recovery from three-week lows in European trading on Thursday. The pair holds gains amid renewed US Dollar selling as traders digest latest tariff threats from US President Trump. Traders resort to repositioning ahead of Friday's US PCE inflation data.

GBP/USD holds gains above 1.2900 on US Dollar weakness
GBP/USD trades with positive bias above 1.2900 in Thursday’s European morning. The pair holds the latest uptick amid renewed US Dollar weakness as fresh Trump tariff threats rekindle US economic slowdown concerns. Focus remains on tariff updates and mid-tier US data.

Gold price retreats from weekly high; sticks to positive bias amid concerns over Trump's tariffs
Gold price retreats slightly after touching a fresh weekly high earlier this Thursday and trades with modest intraday gains, just below the $3,030 level heading into the European session. An improvement in the global risk sentiment turns out to be a key factor acting as a headwind for the precious metal.

Cardano bulls target double-digit gains as bullish bets increase among traders
Cardano price hovers around $0.74 at the time of writing on Thursday after a recovery of over 4% so far this week. On-chain data hints at a bullish picture as ADA’s stablecoin market cap rises while its bullish bets increase among traders.

Auto tariffs dominate, can European stocks maintain their lead over the US?
Tariffs are yet again dominating market sentiment. European stocks have opened sharply lower after President Trump announced a 25% levy on imports of cars and car parts coming into the US.

The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.