The U.S. dollar slid across the board to hit a more than three-month low against its major peers on Wednesday, while the New Zealand dollar surged after its central bank suggested that more rate hikes could be in the offing.

The kiwi was last 0.78% higher at $0.6184, having surged more than 1% earlier in the session to a four-month high of $0.6207 after the Reserve Bank of New Zealand (RBNZ) on Wednesday warned that further policy tightening might be needed if price pressures did not ease.

The hawkish comments, which took investors by surprise, came on the back of the central bank's decision to leave interest rates on hold as expected.

"The upward revision to the cash rate and inflation forecasts for 2024 keeps rate hike bets alive, while New Zealand dollar shorts rushed for the exit," said Christopher Wong, a currency strategist at OCBC.

The Australian dollar edged 0.11% lower to $0.6642, paring some of its gains after having scaled a four-month top of $0.66765 earlier in the session.

Data out on Wednesday showed Australia's inflation eased by more than expected in October as goods prices fell, while core inflation also edged down.

In the broader currency market, the U.S. dollar tumbled to a more than three-month low against a basket of currencies at 102.46, as bets grow that the Federal Reserve could begin cutting rates early next year.

Fed Governor Christopher Waller, a known hawkish and influential voice at the central bank, on Tuesday flagged a possible rate cut in the months ahead, feeding market expectations that U.S. rates have peaked.

The dollar fell more than 0.5% to 146.675 yen, its weakest level in more than two months. It last bought 147.06 yen.

The euro pushed back above $1.10 to an over three-month high of $1.1017. It last traded $1.0998.

Sterling similarly scaled a three-month top of $1.2733 and last traded $1.27155, while the dollar index was last flat at 102.63.

The index was eyeing a nearly 4% loss for November, its worst monthly performance in a year.

Source: Reuters