NZD/USD dropped below 0.5700 for the fourth consecutive session as investors favored the US Dollar, overshadowing TD Securities' revised forecast for three upcoming RBNZ rate hikes.
The NZD/USD pair experienced downward pressure, breaking below the 0.5700 support level despite TD Securities revising its forecast to include three consecutive RBNZ rate hikes. The decline is primarily driven by broad-based US Dollar strength as market participants position themselves ahead of the upcoming Federal Reserve policy decision on Wednesday.
The pair fell because market demand for the US Dollar ahead of the Federal Reserve's policy decision outweighed the positive sentiment generated by the RBNZ rate hike expectations.
The 0.5700 level acted as a critical support zone that the pair tested for four consecutive sessions before ultimately breaking below it.
The New Zealand Dollar weakened against the greenback on Monday, falling below the 0.5700 support level despite a hawkish shift from TD Securities. Analysts now project three consecutive rate hikes from the Reserve Bank of New Zealand, yet market participants prioritized US Dollar accumulation ahead of Wednesday's Federal Reserve policy announcement.
The NZD/USD pair declined because traders prioritized buying US Dollars in anticipation of the Federal Reserve's upcoming policy decision, which outweighed the impact of TD Securities' revised hawkish outlook for the RBNZ.