Robust US consumer sentiment and producer inflation data bolster expectations for prolonged Fed policy tightening.
NZD/USD slipped 0.15% to 0.5830 on Friday as the US Dollar strengthened following upbeat economic releases. The University of Michigan’s preliminary Consumer Sentiment Index rose to 48.9 in June, exceeding forecasts, while one-year inflation expectations eased to 4.6%.
Thursday’s Producer Price Index (PPI) surged 6.5% year-over-year in May, the highest since November 2022, reinforcing bets on a hawkish Fed. The data, alongside geopolitical uncertainty, supported the Dollar’s rally.
Analysts suggest the PPI report may prompt Fed officials to consider another rate hike later this year, extending restrictive policy.