• NZD/USD gains ground to around 0.5895 in Friday’s Asian session. 
• Fed’s Waller said open to holding rates if August inflation shows progress. 
• RBNZ’s Silk said the central bank is more likely to wait until December before raising interest rates again.

The NZD/USD pair gathers strength to near 0.5895 during the Asian trading hours on Friday. The US Dollar (USD) softens against the New Zealand Dollar (NZD) following Federal Reserve (Fed) Governor Christopher Waller’s remarks. Traders brace for the US August employment report later on Friday. 

Waller said on Thursday that he is leaning toward keeping interest rates steady at the Fed’s September meeting, provided there are no surprises from upcoming inflation data. Traders trimmed bets on a US rate hike at this month’s meeting after Waller’s speech, weighing on the Greenback. 

Markets are now pricing in nearly 50.2% odds of a quarter-point hike in September, down from 63.2% on Wednesday, according to the CME’s FedWatch tool.

On the other hand, the Reserve Bank of New Zealand’s (RBNZ) dovish hike could undermine the Kiwi. The RBNZ decided to raise the Official Cash Rate (OCR) by 25 basis points (bps) to 2.75% on Wednesday, as was widely expected. RBNZ Governor Anna Breman stated that it’s likely there will be a further increase, but policymakers want to take time to assess the impact of the increases to date. 

RBNZ Assistant Governor Karen Silk said on Friday that the central bank is more likely to wait until December before raising interest rates again. 

Kiwi outlook stays data dependent as RBNZ keeps options open

Analysts at Commerzbank highlight that the RBNZ was careful not to lock itself into a fixed trajectory, noting that the central bank “stressed that the future rate path is not pre-determined,” and instead signalled that “further tightening is possible but will depend on the persistence of inflation and the strength of the recovery.” This, they argue, underscores a deliberately data-dependent stance, with policymakers keeping the door open to additional hikes while tying any move explicitly to how inflation and growth dynamics evolve.

Technical Analysis: NZD/USD

In the daily chart, NZD/USD holds a mild bullish bias as spot remains above the 100-day simple moving average (SMA) and the lower Bollinger Band, suggesting underlying demand on dips. However, price is still just under the Bollinger 20-period SMA, while the Relative Strength Index (RSI) near 51 hints at only modest positive momentum rather than an impulsive advance.

On the topside, initial resistance is the Bollinger middle band at 0.5910, with the upper band around 0.5985 acting as the next upside barrier if buyers extend the recovery. On the downside, immediate support is seen at the 100-day SMA near 0.5845, followed by the lower Bollinger Band around 0.5832, where a break would weaken the current constructive tone and expose deeper retracements.