Dollar struggles on weak data; Kiwi surges on RBNZ surprise

The U.S. dollar was stuck near two-month lows on Wednesday as weak economic data bolstered views that the Federal Reserve is near the end of its tightening cycle, while the New Zealand dollar jumped after a larger-than expected interest rate hike.

New Zealand’s central bank raised interest by 50 basis points (bps) to a more than 14-year high of 5.25% on Wednesday in a move that surprised markets as 22 of 24 economists in a Reuters poll had forecast just a 25 bps hike.

The kiwi rallied 1% to touch a two-month high of $0.6383 after the decision. It was last up 0.74% at $0.636.

Elsewhere, data overnight showed U.S. job openings dropped to their lowest level in nearly two years in February, suggesting that labour market conditions were finally easing.

Job openings, a measure of labour demand, were down 632,000 to 9.9 million on the last day of February, the monthly Job Openings and Labor Turnover Survey, or JOLTS report, showed. Economists polled by Reuters had forecast 10.4 million openings.

The dollar index, which measures the currency against six peers, eased to a fresh two-month low of 101.43, after dropping 0.5% overnight. It was last at 101.53.

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