• The NZD/USD pair is in positive territory for the fifth day in a row around 0.6165 on Tuesday.
• Investors will be closely watching the American PCE, which should show an raise of 2.8% y/y in April.
• China’s Shanghai has announced support measures to boost its housing market.

The NZD/USD pair extends its rally near 0.6165 on Tuesday during the early Asian session. The pair is rising to its highest level since March amid a weaker US dollar (USD). Investors are waiting for recent catalysts with the release of the price index for U.S. gross domestic product (GDP) and core consumer spending later this week. In addition, Governor Orr’s speech on Friday will be closely watched by the Reserve Bank of New Zealand (RBNX).

Markets are lowering their stance on interest rate cuts by the US Federal Reserve (Fed) due to the hawkish stance of Fed officials and stronger-than-expected US economic data. Investors will be closely watching key US PCE inflation data on Friday. It is forecast that the American Core PCE index will show an raise of 0.3% m/m and 2.8% y/y in April. Higher inflation could dampen expectations for Fed rate cuts and strengthen the dollar.

On the other hand, RBNZ deputy governor Christian Hawkesby stressed that interest rate cuts were not part of the short-term discussion. The RBNZ has kept the interest rate steady at 5.5% for 15 years and has suggested that restrictive policy should be maintained longer to ensure inflation returns to the target range of 1-3%.

According to the Global Times, China’s Shanghai announced on Tuesday support measures for the real estate sector aimed at optimizing the local real estate market and promoting stable and robust development. Analysts believe that this will be a significant impulse for the housing market. The combination of hawkish influence from the RBNZ and the Chinese stimulus plan continues to strengthen the position of China’s Kiwi proxy against the USD.