New Zealand Dollar gains as US Dollar declines on easing Fed rate hike bets

The New Zealand Dollar (NZD) experienced an upward trend as the US Dollar (USD) weakened following comments from Federal Reserve Bank of New York President John Williams. Williams stated that there was no urgency for further monetary tightening after the September rate hike, although a potential increase later in the year remained a possibility if the economy followed forecasts.

This led market participants to reassess their expectations, causing the probability of an October rate hike to drop to approximately 45%, down from 70.9% the previous day. Investors now focus on the forthcoming US Nonfarm Payrolls report, which economists expect to show a 90,000 job increase in September with the unemployment rate remaining steady at 4.1%.

Meanwhile, the NZD gained support from China's positive economic data, with the Manufacturing PMI returning to expansion territory at 50.1 in September, surpassing expectations. The Non-Manufacturing PMI also increased to 50.2, outperforming forecasts. Broad-based economic recovery in China was further bolstered by private sector surveys.

NZD/USD is trading at 0.5650, below short- and medium-term trend measures, indicating a bearish near-term bias, with potential resistance at 0.5682 and support at 0.5792.