USD Starting the Comeback As FED’s Bowman Refuses Rate Cuts

Yesterday the USD made a strong bullish move but earlier today it was retreating, with NZD/USD climbing above 0.61 again. However, the climb stopped as USD buyers started to come back in the US session after the higher Final Q1 GDP and GDP price index report. FED member Bowman also made some hawkish comments, refusing the idea of rate cuts if inflation doesn’t fall to 2%.

This forex pair has been making lower highs for the last two weeks, losing around 150 pips in the process, while moving averages have been acting as resistance at the top, pushing the highs lower and confirming the downtrend. Today it was the 20 SMA (gray) that stopped the climb for NZD/USD , rejecting the price and contributing on the bearish reversal in the US session.

NZD/USD Chart H4 – MAs Have Turned Into Resistance

Remarks From FED Member Bowman

• Not considering a rate cut yet
• Rate cut possible if inflation moves toward 2%
• Current monetary policy is restrictive
• Inflation expected to ease with current policy
• Persistent upside risks to inflation
• Strong economy with moderated activity
• Willing to raise rates again if inflation persists

Fed’s Bowman has stated that the central bank is not at a point where it can consider a rate cut. She indicated that a rate cut might be on the table if inflation moves towards the 2% target. At present, monetary policy remains restrictive, and Bowman expects inflation to ease under the current policy settings.

However, she acknowledged that there are persistent upside risks to inflation. While the economy remains strong, activity has moderated. Bowman also emphasized her willingness to raise rates again if inflation does not continue to decline. However, Bowman’s hawkish stance is consistent with her previous comments and not unexpected.

NZD/USD Live Chart