New Zealand Dollar declines due to increasing risk aversion
NZD/USD depreciates after registering modest gains in the previous day, trading around 0.5860 during the Asian hours on Tuesday. The pair depreciates as the US Dollar (USD) advances on rising safe-haven demand amid uncertainty surrounding the US-Iran peace agreement.
According to a Fox News report, US forces conducted self-defense strikes in southern Iran on Monday. A US Central Command spokesperson stated that the American strikes targeted missile launch sites and Iranian vessels that were attempting to deploy mines. The US military emphasized that it will continue to protect its forces while maintaining restraint during the ceasefire.
However, Bloomberg reported on Monday that the US President Donald Trump said negotiations toward a deal with Iran to end their conflict and reopen the Strait of Hormuz were "proceeding nicely.” Traders will closely monitor developments surrounding the US-Iran peace deal. Any sign of escalation in the Middle East could boost a safe-haven currency such as the Greenback and act as a headwind for the major pair.
Regarding monetary policy, the Reserve Bank of New Zealand (RBNZ) is widely expected to keep its official cash rate unchanged at 2.25% on Wednesday. However, market pricing indicates a growing likelihood of tighter policy ahead, with an implied 80% probability of a rate hike in July and a move fully priced in by September.
Hawkish expectations surrounding the RBNZ policy outlook are driven by global energy supply disruptions that have heightened inflation risks. Consequently, the central bank is anticipated to upwardly revise its projections for both inflation and the future policy rate path at its upcoming meeting.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Beneficient stock surges 439% on $130M debt fix, but trend stays unconfirmed
Bullish on Muse's monetization path, JPMorgan significantly raises Meta's target price
JPMorgan believes that as the monetization model of the AI assistant Muse shifts from subscription-based to transaction commission, coupled with the expansion of the Connector ecosystem and the imminent release of the cutting-edge model Watermelon, Meta is establishing a brand-new high-growth trajectory beyond advertising. At the same time, the company is accelerating the development of its wearable hardware ecosystem, positioning devices such as smart glasses as entry points for Muse.
US Treasury yields “breaking 5” test corporate earnings quality, but JPMorgan remains unfazed: stocks will still be the growth engine for investment portfolios
JPMorgan strategist Grace Peters stated that even though rising bond yields are raising the bar for earnings growth, stocks are still expected to continue climbing.
Japan Bond Sell-Off Sends Yields Higher, Raises Spillover Risk for Gold and Silver
Crypto prices
More
