{
  "id": 15976259,
  "title": "New Zealand Dollar trims gains near 0.5700 after softer CPI inflation data",
  "url": "https://urgent.news/2026/10/22/new-zealand-dollar-trims-gains-near-0-5700-after-softer-cpi-inflation",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-10-22T00:26:28.000Z",
  "source": {
    "name": "FXStreet",
    "slug": "fxstreet",
    "url": "https://www.fxstreet.com/news/new-zealand-dollar-trims-gains-near-05700-after-softer-cpi-inflation-data-202610220026"
  },
  "original_language": "en",
  "account": "The NZD/USD currency pair settled around 0.5705 during the initial Asian trading hours on Thursday. The New Zealand Dollar (NZD) lost some gains against the US Dollar (USD) following lower-than-anticipated Consumer Price Index (CPI) inflation data. Statistics New Zealand reported on Thursday that the country's CPI inflation slowed to 3.7% year-on-year (YoY) in the third quarter (Q3), down from 4.1% in the prior period. This figure fell short of expectations of 3.8%. On a quarterly basis, the CPI climbed 0.7% in Q3, compared to the 1.5% increase in Q2, which was below the 0.8% forecast. The moderate performance of the Kiwi remained below the top of the Reserve Bank of New Zealand's (RBNZ) target band, prompting the currency to dip slightly. However, the CPI outcome stayed above the upper limit of the RBNZ's acceptable range, reinforcing the belief that the central bank will likely raise rates next week. Financial markets are currently assessing a 98% probability that the RBNZ will increase rates again the following week, and a 100% chance of multiple 50 basis points (bps) hikes before the end of February, according to Reuters. Meanwhile, in the United States, traders are monitoring the forthcoming Federal Reserve (Fed) interest-rate outlook ahead of the upcoming policy meeting. Fed Chair Kevin Warsh refrained from offering any insight into whether further rate hikes are needed or when. Shaun Osborne, chief FX strategist at Scotiabank, stated, \"There's not really an overarching theme for markets... and I think it's going to stay that way at least until next week into the FOMC.\" ING analysts noted that markets have been progressively reinforcing their outlook for tighter monetary policy, with investors \"pricing around 18-21 basis points for next week's meeting since RBNZ's Chief Economist Paul Conway's hawkish remarks last week.\" According to ING, Conway's comments indicated that \"this month's decision remains open, with risk leaning towards the upside for the fourth quarter CPI, and the NZD weakness is a cause for concern.\" Despite these signals, the bank expects a 25 basis points rate hike next week, barring any significant surprise in the CPI data. ING maintains that the NZD is undervalued relative to its short-term fair value model and anticipates further recovery against its major peer, the Australian Dollar (AUD). The baseline projection suggests NZD/USD will trade above 0.570 into year-end, driven by hawkish RBNZ comments and the currency's undervaluation. Fed Chair Warsh delivered a moderately constructive yet cautious speech, with an FXS Speechtracker score of 5.6/10, indicating a slightly softer tone compared to the historical average of 6.1/10. His emphasis on being \"over-cautious from the global financial crisis\" underscores a persistent bias toward mitigating downside and financial stability risks, even as Warsh highlights structural growth and investment surges fueled by \"good policies.\" His stance that the Fed will not prematurely judge the October and December meetings and his acknowledgment of AI's potential impact on demand before supply and uncertain near-term employment effects foster a data-dependent outlook, tempering any immediate bullish signal for the Dollar. The FXS Fed Sentiment Index remained steady at 127.51, reflecting a hawkish sentiment, despite the speech's relatively softer implications. The daily chart for NZD/USD demonstrated the pair trading above the Bollinger Bands midpoint and above the 100-day Simple Moving Average (SMA), indicating a tentative base within the recent range, but still below the SMA, which could cap the broader recovery. The Relative Strength Index (14) increased to approximately 56, signaling improving but not yet decisive bullish momentum as price fluctuates between support and the overarching trend barrier. On the upside, the 100-day SMA at 0.5775 serves as the first significant resistance; a daily close surpassing this level would likely trigger a stronger rebound. Conversely, initial support is positioned around the upper Bollinger Band at approximately 0.5705, followed by the Bollinger midpoint near 0.5635. A decline below the lower band, around 0.5565, could expose the pair to a deeper retreat within the prevailing range.",
  "summary": "The NZD/USD pair steadies near 0.5705 during the early Asian trading hours on Thursday. The New Zealand Dollar (NZD) pares gains against the US Dollar (USD) following softer-than-expected Consumer Price Index (CPI) inflation data. The weekly US Initial Jobless Claims report is due later on Thursday.",
  "key_points": [
    "NZD/USD settles at 0.5705 after lower-than-expected CPI inflation data",
    "New Zealand CPI inflation slows to 3.7% YoY in Q3, below expectations",
    "RBNZ likely to raise rates next week based on hawkish remarks"
  ],
  "editors_take": "Slower inflation growth in New Zealand creates a tug-of-war for the currency as cooling price data competes with strong market expectations for imminent interest rate hikes from the central bank.",
  "illustration": null,
  "coverage": {
    "outlets": 2,
    "also_reported_by": [
      {
        "outlet": "FXStreet",
        "title": "New Zealand's CPI inflation eases to 3.7% YoY in Q3, vs 3.8% expected",
        "url": "https://urgent.news/2026/10/21/new-zealands-cpi-inflation-eases-to-3-7-yoy-in-q3-vs-3-8-expected",
        "published": "2026-10-21T21:52:11.000Z"
      }
    ]
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}