- Trade data from China helps NZD gather strength on Friday.
- US Dollar Index drops below 97.
- Coming up: Import price index and consumer confidence data from the U.S.
The NZD/USD pair came under modest selling pressure in the early Asian session and touched its lowest level since late January at 0.6713 after the data from New Zealand showed that the Business NZ PMI slumped to 51.9 in March from 53.4 in February and missed the market expectation of 54.4 by a wide margin. However, with the trade data from China coming in stronger than expected, the NZD started to gather strength and preserved its momentum during the European trading hours amid broad-based USD weakness.
Trade surplus in China rose to $32.64 billion in March from $4.08 billion in February and came in much higher than analyst' estimate of $7.05 billion. Although a sharp decline in imports, 7.6%, seems to have caused the trade surplus to widen, antipodeans were able to take advantage of the improved sentiment.
Meanwhile, ahead of the University of Michigan's preliminary Consumer Confidence Index, which is expected to edge lower to 98 from 98.4 seen in the previous release, and import/export price index data from the U.S., the greenback struggles to find demand with investors staying focused on risk-sensitive assets. At the moment, the US Dollar Index is at 96.80, losing 0.37% on a daily basis.
Technical levels to consider
As of writing, the pair is trading at 0.6760, adding 0.5% on the day and could face the initial resistance at 0.6770 (Apr. 11/Apr. 10 high) ahead of 0.6800 (psychological level/100-DMA and 0.6825 (50-DMA). On the downside, supports could be seen at 0.6735 (200-DMA), 0.6715 (Feb. 12 low) and 0.6670 (Jan. 4 low).
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