Cooling US inflation data cuts September Fed rate hike odds to 30%, weakening USD and lifting the NZD/USD pair.
The NZD/USD pair climbed to session highs above 0.5880 on Wednesday, driven by a broad USD decline after US inflation data reduced expectations for a Federal Reserve rate hike in September. Odds of a September hike fell to nearly 30%, the lowest since mid-June, pressuring the USD and boosting risk sentiment despite geopolitical tensions.
The pair rebounded from 0.5820 lows, holding above its 200-day simple moving average and maintaining an upward trendline from late-June. Technical indicators suggest a cautiously bullish bias, with resistance eyed at 0.5905-0.5920, aligning with August highs and a key Fibonacci retracement level.
US data releases later in the session are unlikely to materially shift Fed pricing, leaving the focus on technical levels and broader USD sentiment.