NZD/USD extended its advance for a third session, reaching a fresh high since early June around 0.5965–0.5970 in Friday’s Asian trade, positioning the pair for a strong weekly rise. The move has been underpinned by a softer US Dollar as markets scaled back expectations of an immediate Federal Reserve rate rise, while the New Zealand Dollar found support from bets on another Reserve Bank of New Zealand hike. Technicals have also held firm, with the pair trading above the 200-period Exponential Moving Average at 0.5851, reinforcing a bullish near-term bias.
Risk Sentiment and Geopolitical Factors
Risk sentiment stayed sensitive to inflation concerns linked to higher oil prices and the Middle East crisis, while hawkish FOMC Minutes kept the prospect of further US policy tightening in play. Geopolitical premiums persisted as traders monitored the US–Iran stalemate over the Strait of Hormuz, alongside rhetoric on sanctions enforcement. New Zealand posted a July monthly trade deficit of NZ$1.95 billion, though price action remained driven mainly by USD dynamics, with flash US PMIs and geopolitical headlines set to steer near-term moves.
