New Zealand dollar continues to trade above US$0.62

Key Movers

The US dollar remains under pressure as expectations grow for additional rate cuts by the US Federal Reserve by the end of 2024. The latest dot plot projections indicate a gradual easing cycle, with the median rate for 2024 revised down to 4.375% from the June forecast of 5.125%. The Fed delivered its first interest rate cut decision in more than four years last Wednesday, in which it reduced its key borrowing rates by 50 basis points (bps) to 4.75%-5.00%. The number of Americans filing new applications for unemployment benefits dropped to a four-month low last week, pointing to solid job growth in September and offering confirmation that the economy continued to expand in the third quarter. Initial claims for state unemployment benefits dropped 12,000 to a seasonally adjusted 219,000 for the week ended Sept. 14, the lowest level since the middle of May, the Labor Department said last Thursday. Economists polled by Reuters had forecast 230,000 claims for the latest week. The stock market took a breather Friday with the Dow Jones Industrial Average eked out a 0.1% gain to close at a record high for the second consecutive session. The S&P 500 slid 0.2% from its own record high. The Nasdaq Composite, about 4% off its all-time high, dipped 0.4%. All three indexes advanced about 1.5% over the week. Gold prices climbed past $2,600, recording new all-time highs amid increasing speculation that the Federal Reserve (Fed) will continue to lower borrowing costs.