The New Zealand dollar (NZD) rose against the U.S. dollar (USD), crossing the 0.5950 mark as investors brace for key U.S. Personal Consumption Expenditures (PCE) data. This inflation report, closely monitored by the Federal Reserve, is expected to shed light on inflation trends and could impact future interest rate decisions, which would likely influence the currency pair’s trajectory.
Recent gains in NZD/USD reflect a softer U.S. dollar alongside favorable domestic factors, as traders focus on how PCE data might shape Fed policy. Strong inflation numbers may signal the need for a continued restrictive stance from the Fed, potentially strengthening the USD and weighing on NZD/USD. Conversely, if inflation appears to ease, it may boost NZD/USD by tempering rate hike expectations.
For now, the 0.5950 level serves as a critical marker, acting as potential support or resistance depending on upcoming inflation data and central bank signals. Market sentiment remains cautious, with currency traders watching closely for any shifts following the PCE release and its implications on global risk appetite.
