• NZD/USD remains on the defensive near its lowest level since November amid a bullish USD.
• Reduced bets for a June Fed rate cut and the risk-off mood lifts the USD to a multi-week top.
• Traders now look to the US macro data and speeches by Fed officials for short-term impetus.

The NZD/USD pair oscillates in a narrow trading band during the Asian session on Tuesday and consolidates its recent losses to the lowest level since November 14 touched the previous day. Spot prices hold steady around mid-0.5900s and seem vulnerable to prolonging a multi-week-old descending trend.

The US Dollar (USD) stands tall near its highest level since February 2024 touched in the aftermath of the upbeat US data on Monday, showing that the manufacturing sector registered growth in March for the first time since September 2022. The US ISM Manufacturing PMI increased to 50.3 in March from 47.8 in the previous month to end 16 straight months of contraction. This forced investors to trim their bets that the Federal Reserve (Fed) will start cutting interest rates in June, triggering a fresh leg up in the US Treasury bond yields and underpinning the buck.

In fact, the yield on the rate-sensitive two-year and the benchmark 10-year US government bonds climbed to a two-week peak, which, along with the risk-off impulse, should benefit the safe-haven Greenback and drive flows away from the risk-sensitive Kiwi. The NZD/USD pair, meanwhile, fails to gain any respite from the Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr's comments, saying that the MPC remains laser-focused on its job to control inflation. Orr added that the central bank is on track to getting inflation back into the target band.

Market participants now look to the US economic docket – featuring the release of JOLTS Job Openings and Factory Orders – for some impetus later during the early North American session. This, along with speeches by influential FOMC members, the US bond yields and the broader risk sentiment, might influence the USD price dynamics and produce short-term opportunities around the NZD/USD pair. Nevertheless, the aforementioned fundamental backdrop favours bearish traders and suggests that the path of least resistance for spot prices is to the downside