NZD/USD backslid on Wednesday after the latest Meeting Minutes from the Federal Reserve’s (Fed) Federal Open Market Committee (FOMC) revealed a far more cautious stance on rate cuts than many investors had hoped for.
Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr will be speaking late Wednesday ahead of the Thursday Pacific pre-market. RBNZ Governor Orr will be followed by New Zealand Retail Sales.
Read more: Fed Minutes leave the door open to a probable rate cut in September
While the FOMC’s latest Meeting Minutes didn’t outright rule out a September rate cut, Fed policymakers remain firmly more hawkish than investors have been hoping for, and odds of a September rate cut have eased even further. According to the CME’s FedWatch Tool, rate markets are pricing in under 60% chances of a quarter-point cut in September after the FOMC revealed a firm desire from Fed members to await firmer signs that the pace of inflation will continue falling to the Fed’s 2% target.
The Kiwi has tumbled back to the 200-hour Exponential Moving Average (EMA) at 0.6080, backsliding from Wednesday’s early peaks near 0.6150. NZD/USD hit its highest bids since mid-March in Wednesday, but has tumbled to a one-week low and is on pace to slide back below the 200-day SMA at 0.6073.
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