Ella 
NZD/USD has been on the rise, extending gains for the third consecutive trading day. During the Asian session on Tuesday, NZD/USD traded higher around 0.6260. The pair rebounded from a three-week low of 0.6181 on Friday following mixed US economic data.
Additionally, the pair appears to have been affected by comments from members of the Federal Reserve (FED) hinting at the possibility of a rate cut by the end of 2024. These comments stoked risk-on sentiment, putting downward pressure on the US dollar (USD), causing the pair to rise.
Atlanta Fed President Raphael W. Bostic expects two quarters of rate cuts by the end of 2024, reflecting a cautious approach given that inflation has fallen more than initially expected. On the other hand, U.S. Federal Reserve Board Governor Michelle W. Bowman’s speech indicated an observational stance. She said that the current policy stance seemed strict enough, but also acknowledged that if the inflation rate approaches 2%, target, the Fed is likely to lower policy rates.
The U.S. Dollar Index (DXY) appears to have extended losses, trading around 102.10. The decline in U.S. Treasury bond yields has weighed on the dollar. As of press time, the 2-year and 10-year U.S. Treasury bond yields were 4.37% and 4.02% respectively.
News from China about the bankruptcy and liquidation of Zhongzhi Enterprise Group may hinder the appreciation of the New Zealand dollar. Zhongzhi Enterprise Group has debts of $64 billion and its financial woes have raised concerns about a broader real estate debt crisis spreading to the financial sector.
The focus on New Zealand building approvals, especially ahead of Thursday’s US Consumer Price Index (CPI) data, highlights the potential impact on the NZD/USD currency pair. In addition, Friday’s Chinese consumer price index (CPI) and producer price index (PPI) data may also attract attention, given the interconnectedness of the global economic landscape.
