NZD/USD struggles to pull away from lows after US data, stays near 0.6560
|- NZD/USD stays under modest bearish pressure in early American session.
- Weekly Jobless Claims in US fell below 1 million for the first time in five months.
- US Dollar Index stays in the negative territory below 93.20.
The NZD/USD pair rose toward 0.6600 during the Asian session supported by a sharp upsurge witnessed in the positively-correlated AUD/USD pair but struggled to preserve its bullish momentum. With the risk-averse market atmosphere making it difficult for the kiwi to find demand, the pair edged lower and was last seen losing 0.22% on the day at 0.6560.
RBNZ's dovish shift continues to hurt NZD
In addition to the dismal market mood, the dovish shift seen in the Reserve Bank of New Zealand's, which expanded its quantitative easing to 100 billion NZD, policy outlook on Wednesday doesn't allow the NZD to gather strength against its peers.
Commenting on the RBNZ's policy announcement, “the RBNZ will want to keep its options open. In this regard, a negative OCR and foreign asset purchases will remain options on the table," said UOB Group analysts. "The RBNZ may consider expanding the programme to include other assets (including foreign assets). This could help cap excessive gains in the New Zealand dollar.”
Meanwhile, the data published by the US Department of Labor showed on Thursday that the weekly Initial Jobless Claims fell below 1 million for the first time since the unprecedented upsurge witnessed back in March.
Although the initial market reaction provided a modest boost to the greenback, the US Dollar Index failed to stage a convincing recovery and was last seen losing 0.33% on a daily basis at 93.12.
There won't be any significant macroeconomic data releases in the remainder of the day. In the early Asian trading hours on Friday, the Business NZ PMI data from New Zealand will be looked upon for fresh catalysts.
Technical levels to watch for
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