NZD/USD holds positive ground above 0.5850 amid Fed uncertainty

• NZD/USD trades with mild gains around 0.5855 in Wednesday's Asian session.
• Fed's Powell said the outlook for the labor market and inflation faces risks.
• The Reserve Bank of New Zealand names Anna Breman as new governor. 

The NZD/USD pair recovers some lost ground near 0.5855 during the Asian session on Wednesday. The US Dollar (USD) weakens against the New Zealand Dollar (NZD) as traders continue to digest different comments from Federal Reserve (Fed) policymakers, while key gauges of US business activity disappointed investors somewhat. 

Fed Chair Jerome Powell said on Tuesday that the outlook for the labor market and inflation faces risks. Powell further stated that policymakers likely have a difficult road ahead as they weigh further interest-rate cuts. 

Powell offered no hints on whether he might support a rate reduction at the Fed's next meeting. Money markets are currently pricing in nearly a 90% possibility of a Fed rate cut in October, down slightly from 92% a day earlier, according to the CME FedWatch tool.

US business activity lost momentum in September, according to the flash reading of S&P Global's Composite PMI, which declined to 53.6 from 54.6 in August. This, in turn, weighs on the Greenback and creates a tailwind for the pair. Meanwhile, the Manufacturing PMI eased to 52.0 in September from 53.0 in the previous reading. The Services PMI dropped to 53.9 during the same period versus 54.5 prior. 

On the Kiwi front, New Zealand's Finance Minister Willis on Wednesday appointed Anna Breman as the new governor of the Reserve Bank of New Zealand (RBNZ). Breman has been appointed for five years, and she will start her new role on December 1.