NZD/USD remains on a back foot around 0.6700 amid overall USD strength, lack of data
|- Greenback benefited from the US Retail Sales, showed little attention to now normally dovish Fedspeak.
- Kiwi buyers booked profits, earned through upbeat NZ inflation data, after the GDT Price Index.
- Trade tensions remain elevated, exerting downside pressure on the pair.
- A lack of data highlights political/trade headlines for fresh impulse.
With the renewed US data strength questioning the dovish Fed speakers, the NZD/USD pair remains soft around 0.6700 at the start of the Asian session on Wednesday.
Despite most policymakers from the US Federal Reserve setting up for a rate cut later this month, traders preferred the US Dollar (USD) as latest Retail Sales data buoyed sentiment following upbeat prints of NY Empire State Manufacturing Index posted earlier during the week.
The New Zealand Dollar (NZD) couldn’t hold on previous gains earned through welcome inflation numbers at home as the US-China trade tussles heated after the US President Donald Trump signaled a long-way to go for a deal and hinted that they could levy fresh tariffs on China.
Recently, New Zealand’s GDT Price Index for the first half of July beat -2.5% market expectations with +2.7% while Whole Milk Powder (WMP) rose beyond the central bank’s medium-term assumption with a solid 3.6% increase to USD3074.
Given the lack of data, except for second-tier housing numbers from the US, investors might keep an eye over the news flow for fresh impulse.
Technical Analysis
Having registered another failure to sustain a break of the 200-day exponential moving average (EMA), the Kiwi pair is expected to stretch its latest pullback a bit more towards 100-day EMA level of 0.6665 with July 09 top surrounding 0.6632 being a follow-on level to watch. On the other hand, buyers would prefer a successful break of the latest high surrounding 0.6740 in order to aim for mid-April tops near 0.6785.
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