The New Zealand dollar edged up to around $0.589, returning to a two-month high as improving developments in Middle East diplomacy supported risk sentiment. Iran and Oman announced an agreement on the geographic coordinates for a temporary commercial shipping route through the Strait of Hormuz, easing concerns over prolonged energy supply disruptions. The kiwi had weakened in the previous session following a softer-than-expected jobs report, which reinforced the case that any further interest rate increases would likely be gradual rather than aggressive. However, markets continued to price in a quarter-point rate hike in September after the Reserve Bank of New Zealand indicated at its latest meeting that further tightening may be needed to reduce monetary stimulus and bring inflation under control.