NZD/USD fluctuates below 0.64 as markets wait for fresh US-China trade developments
|- White House adviser Kudlow says they are close to finalising phase-one of trade deal.
- Business NZ PMI shows improvement in business activity in October.
- US Dollar Index trades above 98 ahead of key data releases.
Following Wednesday's rally that was fueled by the Reserve Bank of New Zealand's decision to keep the policy rate unchanged at 1%, the NZD/USD pair staged a deep correction on Thursday before going into a consolidation phase on Friday. As of writing, the pair was virtually unchanged on a daily basis at 0.6380.
Trade headlines drive the pair's action
The dismal market mood on Thursday weighed on the risk-sensitive NZD as investors continued to assess US President Trump's comments revealing his intention to raise tariffs if they were to fail to reach a trade deal.
However, the Business NZ's Purchasing Managers' Index (PMI) improved to 52.6 in October from 48.4 in September and beat the market expectation of 48.4 to help the kiwi stay resilient against its rivals. Moreover, in the early trading hours of the Asian session on Friday, White House economic adviser Larry Kudlow noted that they were very close to concluding the phase-one of the trade deal with China to provide additional support to the NZD.
In the second half of the day, the NY Fed's Empire State Manufacturing Survey and Retail Sales data from the United States will be looked upon for fresh catalysts. Ahead of these data, the US Dollar Index is posting small daily gains near the 98.20 mark.
Technical levels to watch for
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