NZD/USD aims to capture 0.5800 amid weaker DXY, Caixin Manufacturing PMI data plunge

NZD/USD is aiming to smash 0.5800 despite weak Caixin Manufacturing PMI data.
Caixin Manufacturing PMI has slipped to 48.1 vs. expectations of 49.5.
A fifth consecutive 50 bps rate hike is expected by the RBNZ.

Sagar Dua FXStreet

The NZD/USD pair has dropped marginally below 0.5730 in the Tokyo session after facing barricades around 0.5750. The asset is marching towards 0.5800 despite a downbeat China’s Caixin Manufacturing PMI data. The economic data has landed at 48.1, lower than the expectations and the prior release of 49.5.

It is worth noting that New Zealand is a leading trading partner of China and a weaker-than-projected Caixin Manufacturing PMI data has a significant impact on NZ's fiscal balance sheet.

Apart from that, the Chinese Finance Ministry is planning to issue government bonds worth 2.5 trillion yuan in the fourth quarter, as reported by Reuters. The decision is supposed to safeguard the markets from any further turmoil as the economy is not expected to display a decent growth rate amid zero tolerance for Covid-19 spread and the real estate crisis. It will support the kiwi export data.

Next week, investors will focus on the interest rate decision by the Reserve Bank of New Zealand (RBNZ). Reuters poll on RBNZ rate hike forecast claims a fifth consecutive rate hike by 50 basis points (bps). A fifth half-a-percent rate hike by the RBNZ Governor Adrian Orr will push the Official Cash Rate (OCR) to 3.5%. It would be worth watching whether an OCR above 3% is sufficient to anchor the galloping inflation.

Meanwhile, the US dollar index (DXY) is expected to decline further as it is facing barricades around 112.00 in the Tokyo session. The DXY has weakened after a consecutive decline in the US growth rate by 0.6%. Going forward, the Michigan Consumer Sentiment Index (CSI) data will be keenly focused. The sentiment data is expected to remain steady at 58.5.

NZD/USD

Overview
Today last price	0.5722
Today Daily Change	-0.0004
Today Daily Change %	-0.07
Today daily open	0.5726

Trends
Daily SMA20	0.5933
Daily SMA50	0.6127
Daily SMA100	0.622
Daily SMA200	0.648

Levels
Previous Daily High	0.5737
Previous Daily Low	0.5648
Previous Weekly High	0.6003
Previous Weekly Low	0.573
Previous Monthly High	0.647
Previous Monthly Low	0.6101
Daily Fibonacci 38.2%	0.5682
Daily Fibonacci 61.8%	0.5703
Daily Pivot Point S1	0.567
Daily Pivot Point S2	0.5615
Daily Pivot Point S3	0.5581
Daily Pivot Point R1	0.5759
Daily Pivot Point R2	0.5793
Daily Pivot Point R3	0.5848

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

EUR/USD trims gains, back below 1.1800

EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.

GBP/USD off highs, recedes to the sub-1.3500 area

Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.

Gold climbs to weekly tops, approaches $5,100/oz

Gold keeps the bid tone well in place at the end of the week, now hitting fresh weekly highs and retargeting the key $5,100 mark per troy ounce. The move higher in the yellow metal comes in response to ongoing geopolitical tensions in the Middle East and modest losses in the US Dollar.