- NZD/USD is pressured, down some 0.48% on the way to breaking below 0.66 the figure.
- Bears are in charge as the US dollar firms at the start of the week.
NZD/USD has been forced lower at the start of the week as the US dollar rallies. At 0.6605, the kiwi is lower by 0.43% and has fallen from a high of 0.6636 and reached a low of 0.6597. Risk aversion is denting the commodity complex as Covid risks rear their ugly head in the open.
The Chinese Covid-19 outbreak may have been spreading in Bejing for a week, city authorities said on Saturday at a press briefing who are tracking cases across multiple districts. The capital reported 22 new local cases on Saturday, national health authorities said Sunday morning.
"The city has recently seen several outbreaks involving multiple transmission chains, and the risk of continued and undetected transmission is high. The situation is urgent and grim," municipal official Tian Wei told reporters Saturday. "The whole city must act immediately."
Nevertheless, the central banks will come back into vogue with hawkish rhetoric coming from both the Federal Reserve and the Reserve Bank of New Zealand. ''We now expect the Reserve Bank of New Zealand (RBNZ) to hike the official cash rate (OCR) by 50bps at the May meeting and another 25bps in July to bring the OCR to 2.25%, slightly above neutral (estimated at 2.0%),'' analysts at Standard Charted said.
However, the Fed is taking up the attention of markets as policymakers express a need for 50-bps rate hikes to the Federal Funds Rates (FFR); even a 75-bps rate hike was considered by the hawkish St. Louis Fed President Bullard. Nomura is also predicting that after a 50 bps rate hike in May, the Fed would follow up with two 75 bps rate hikes in June and July. Fed Chair Powell, was saying last week that a 50-bps rate hike in the May meeting “is on the table.”
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
AUD/USD: Extra gains in the pipeline above 0.6520
AUD/USD partially reversed Tuesday’s strong pullback and regained the 0.6500 barrier and beyond in response to the sharp post-FOMC pullback in the Greenback on Wednesday.
EUR/USD meets support around 1.0650
EUR/USD managed to surpass the key 1.0700 barrier in response to the intense retracement in the US Dollar in the wake of the Fed’s interest rate decision and Chair Powell’s press conference.
Gold surpasses $2,300 as Dollar tumbles
The precious metal maintains its constructive stance and trespasses the $2,300 region on Wednesday after the Federal Reserve left its FFTR intact, matching market expectations.
Bitcoin price reclaims $59K as Fed leaves rates unchanged
The market was at the edge of its seat on Wednesday to see whether the US Federal Reserve (Fed) would cut interest rates during the Federal Open Market Committee (FOMC) meeting.
The market welcomes the Fed's statement
The market has welcomed the Fed statement, and the S&P 500 is higher in its aftermath, the dollar is lower and Treasury yields are falling. There is still only one cut priced in by the Fed.