NZD/USD: bulls eye 0.7280/13 levels
|NZD/USD is flat on the session so far trading in a tight range around the midpoint of the 0.72 handle.
NZD/USD made a recovery from below the 0.72 handle at 0.7185 and drifting into a positive close, albeit still down on the week from 0.7318 highs. The dollar was under the spotlight last week with the FOMC decision and Yellen speaking.
The Fed raised rates as widely expected, but the tone was not as dovish as markets had been preparing for. Yellen was confident that the Fed were on target and that the economy will improve. The Federal Reserve will likely raise rates again and begin to shrink its balance sheet this year and that was supportive to the dollar in the main.
However, on the back of some disappointing economic data for Friday (lower housing starts and a fall in consumer confidence), treasuries could only strengthen modestly and the USD weakened. The yield on the 10-year note dropped 2bp to 2.15%. Markets will now turn to the RBNZ and GDT price index this week.
NZD/USD levels
Due to the GDP miss and a modest recovery in the greenback, the bird is somewhat anchored around this 0.7250 mark guarding 0.7280 target. To the downside, 0.7145 and a break back below 0.7080/90 are key near-term downside areas. On the wide, the 0.7375 YTD highs are a key target to the upside and to the downside, a break below 0.7080/00 opens 0.6970.
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