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NZ dollar slips from three-week highs near 0.5800 as USD rebounds
NZD traded around 0.5775 after peaking at 0.5794, even as it remained up roughly 1% for the week following New Zealand’s 25 bps RBNZ rate hike earlier this week.
The New Zealand dollar retreated from fresh three-week highs against the US dollar on Friday, with NZD/USD last seen around 0.5775 after touching 0.5794 earlier in the session, according to FXStreet.
FXStreet said the NZD’s weekly performance is still supported by the Reserve Bank of New Zealand’s hawkish move earlier this week, when the RBNZ lifted its Official Cash Rate by 25 basis points to 2.5% and signaled further tightening to bring inflation back to its 2% target.
In the US, FXStreet reported that the minutes of the Federal Reserve’s latest policy meeting did not provide support for the dollar. The report noted that US rate projections showed a split among Fed participants on the timing of the next rate hike, leaving investors weighing when further tightening might come.
FXStreet also pointed to a softer risk backdrop as investors considered rumours of diplomatic efforts to bring the US and Iran back to negotiations. It said hostilities had been halted between rival sides, but the Strait of Hormuz was described as practically closed, which kept risk appetite subdued.