NZD/USD extends daily slide to fresh multi-month lows near 0.7000
- NZD/USD continues to push lower following Wednesday's drop.
- US Dollar Index closes in on 92.00 ahead of mid-tier data.
- Hawkish shift seen in FOMC's Summary of Projections boosts USD.
The NZD/USD pair lost nearly 70 pips on Wednesday as the USD gathered strength on the back of the hawkish shift witnessed in policymakers' outlook in the Summary of Projection. With the greenback rally remaining intact on Thursday, the pair extended its slide and was last seen trading at its lowest level since April 13 at 0.7051, losing 0.48% on a daily basis.
DXY preserves bullish momentum
The Fed's dot plot revealed that the number of policymakers who expect a rate hike in 2022 rose to seven from four in March. Furthermore, 13 policymakers are now seeing a rate hike in 2023, compared to seven in the previous publication.
Reflecting the positive impact of this development on the USD, the US Dollar Index (DXY) rose 1% and registered its biggest one-day percentage gain of the year. Currently, the DXY is at its highest level in two months at 91.78, up 0.43% on the day.
Later in the session, the weekly Initial Jobless Claims data and the Federal Reserve Bank of Philadelphia's Manufacturing Survey for June will be looked upon for fresh impetus.
On the other hand, the data from New Zealand revealed on Thursday that the Gross Domestic Product (GDP) grew by 2.4% in the first quarter. Although this reading beat the market expectation for an expansion of 0.9% by a wide margin, the broad-based USD strength didn't allow NZD/USD to gain traction.
Technical levels to watch for