NZD/USD dives to fresh lows below 0.5840 as the US Dollar appreciates

• The New Zealand Dollar resumes its bearish trend against the USD and hits fresh three-week lows at 0.5835.
• New Zealand's authorities nominated Dr Anna Brenan as the next RBNZ governor on Wednesday.
• The US Dollar appreciates after Fed's Powell warns that further rate cuts are not guaranteed.

The New Zealand Dollar is accelerating its downtrend against a firmer US Dollar, weighed by moderate risk aversion. The pair extended its reversal from Tuesday's highs, right below 0.5870, into fresh three-week lows at 0.5835 so far.

Dr Anna Brennan, Deputy Governor of the Swedish Central Bank, was nominated as the next Governor of the Reserve Bank of New Zealand earlier on Wednesday, to replace former governor Andrew Orr, who resigned unexpectedly earlier this year.

The RBNZ might cut rates further before Governor Brennan takes charge

Brennan is expected to begin her tenure on December 1. Until then, the acting governor, Christian Hawkesby, will oversee the October 8 and November 26, which are likely to deliver further interest rate cuts considering New Zealand's deteriorating economic outlook.

In the US, flash PMI failed to support the US Dollar on Tuesday, as both the services and the manufacturing sectors' activity showed softer growth in September. The US Dollar, however, drew some support from Fed Chair Jerome Powell, who warned about the upside risks to inflation and hinted at a gradual easing cycle, rather than the steep one anticipated by the markets

A somewhat sourer sentiment is driving markets on Wednesday, pushing the US Dollar moderately higher in the absence of key fundamental releases, as investors await US GDP data on Thursday and the PCE Price Index, the Fed's inflation gauge of choice.