• NZD/USD rebounds strongly to 0.6100 on an expected decline in the US core PCE Inflation data for May.
• Annual US core PCE declined to 2.6% from 2.8% in April.
• Cooling US inflation figures have boosted Fed rate-cut prospects.

The NZD/USD pair recovers its intraday losses and rises to near the round-level resistance of 0.6100 in Friday’s American session. The Kiwi asset gains as the US Dollar (USD) declines after the United States (US) Personal Consumption Expenditure inflation (PCE) report showed that price pressures softened expectedly in May.

The PCE inflation report showed that inflation decelerated to 2.6% from the prior release of 2.8% on a year-on-year. On month, price pressures grew at a slower pace of 0.1% from the former release of 0.3%, upwardly revised from 0.2%. Soft US inflation data has prompted expectations of early rate cuts by the Federal Reserve (Fed).

The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, drops to near 105.80.

Meanwhile, the New Zealand Dollar (NZD) will dance to the tunes of the Caixin Manufacturing PMI data for June, which will be published on Monday. Activities in the manufacturing sectors are expected to have grown modestly to 51.2 from the prior release of 51.7. It is worth noting that New Zealand is one of the leading trading partners of China and slower growth in China weighs on the New Zealand Dollar.