Financial Insights

US dollar rests after Jerome Powell push, New Zealand rates in focus.

The dollar paused for breath on Wednesday after surging with bets on higher rates when Jerome Powell was picked for a second term as Federal Reserve chair, while the New Zealand dollar was on edge ahead of a central bank decision on a rate-hike path.

In emerging markets, the Turkish lira has collapsed and fell more than 11% in one session overnight, setting the scene for further capital outflows and possibly putting pressure on EM currencies globally.

Among majors the market has steadied after the dollar’s jump.

The kiwi has been slipping ahead of the Reserve Bank of New Zealand meeting, which is the main focus of traders in the Asia session, even though a hike is expected and pricing suggests a 40% chance it is a big one — 50 basis points.

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