Ella 
On Monday, NZD/USD extended gains for the second consecutive trading day, with the Asian market rising to around 0.5980. NZD/USD strengthened following dovish remarks from Federal Reserve (FED) Chairman Jerome Powell on Friday. Federal Reserve Chairman Powell pointed out that the latest U.S. personal consumption expenditures (PCE) price index data were in line with expectations, confirming the Federal Reserve’s stance that it may cut interest rates this year.
Federal Reserve Governor Christopher Waller reiterated his stance that there is “no rush” to cut interest rates, especially given continued inflationary pressures. In addition, San Francisco Fed President Mary C. Daly also expressed the same view. Daly emphasized that although the Fed is prepared to adjust interest rates based on economic data, given the soundness of the U.S. economy and the extremely low risk of recession, there is currently no need to do so. Cut interest rates.
The U.S. Dollar Index (DXY) faces challenges as U.S. Treasury yields fall. The U.S. dollar index is hovering around 104.50, with the two-year U.S. Treasury yields and the 10-year U.S. Treasury yields at 4.60% and 4.19% respectively at press time. Federal Reserve officials maintained their forecast for three interest rate cuts this year. Market players expect the first rate cut to come at the June meeting.
On the other hand, NZD/USD is facing downward pressure on speculation that the Reserve Bank of New Zealand (RBNZ) may start cutting policy rates early next year.
