The NZD/USD pair held near its daily low around 0.5625 on Wednesday, as cautious market sentiment kept the New Zealand dollar under pressure. The pair’s lackluster performance reflects broader investor hesitation ahead of the Federal Open Market Committee (FOMC) minutes, which could shape expectations for U.S. monetary policy.
Weakness in the kiwi comes amid a strengthening U.S. dollar, buoyed by safe-haven demand and anticipation of a hawkish Fed stance. Traders are closely watching the minutes for insights into the Federal Reserve’s outlook on interest rates, particularly after recent mixed U.S. economic data.
Globally, the risk-averse mood is weighing on risk-sensitive currencies like the New Zealand dollar. Concerns over slowing economic growth and volatile commodity prices further limit the kiwi’s upside potential, leaving NZD/USD vulnerable to additional losses.
As the pair hovers near key support, market participants await fresh cues from the FOMC minutes and upcoming economic releases. Without a significant shift in risk sentiment or data surprises, NZD/USD may remain under pressure in the short term.
