NZD/USD drops to the 0.5900 mark, US soft landing concern ahead of the US CPI data

NZD/USD loses momentum just above the 0.5900 area.
The headlines surrounding economic development in China might benefit the Kiwi (NZD).
Investors believe that the Federal Reserve (Fed) will pause the interest rate in the September’smeeting
Market players await the US Consumer Price Index (CPI), Chinese data.

Lallalit Srijandorn FXStreet

The NZD/USD pair loses ground to 0.5910 after retreating from a weekly high of 0.5935 during the early Asian trading hours on Tuesday.

The latest data from Statistics New Zealand revealed on Tuesday that the nation’s Electronic Card Retail Sales for August came in at 3.7% YoY from 2.2% in the previous reading, while the monthly figure grew 0.7% versus 0% prior. Finally, the Visitor Arrivals for July came in at 59.3% YoY from the previous reading of 88.5%.

Apart from this, the headline surrounding economic development in China might benefit the China-proxy New Zealand Dollar (NZD) and limit the downside of the NZD/USD pair. That said, China’s deflation pressures eased as consumer prices in August improved from a negative territory. The data released on Saturday showed that the Chinese Consumer Price Index (CPI) for August rose 0.1% YoY, from a 0.3% drop in the previous month, compared to the 0.2% rise expected. The monthly figure was 0.3% as expected.

On the US Dollar front, recent data showed that the US manufacturing sector has been weaker than the services sector. Investors believe that the Federal Reserve (Fed) will pause the interest rate in the September meeting. However, the release of the US Consumer Price Index (CPI) on Wednesday could provide hints Fed about the further rate hike for the rest of the year. Investors expect the US headline CPI to rise at a 0.5% annual rate owing to a rebound in gasoline costs. While core inflation remained stable at 0.2%.

US Treasury Secretary Janet Yellen said on the weekend that she felt more optimism that the US could control inflation without damaging the employment market. Yellen also said on Sunday that every gauge of inflation is declining and there were no massive wave of layoffs.

Looking ahead, the US Consumer Price Index (CPI) on Wednesday will be closely watched by market players. On Thursday, the US Retail Sales and Industrial Production will be due. The attention will shift to the release of Chinese Retail Sales and Industrial Production for July, which might influence the Kiwi. Traders will take a cue from the figures and find trading opportunities for the NZD/USD pair.

NZD/USD

Overview
Today last price	0.591
Today Daily Change	-0.0010
Today Daily Change %	-0.17
Today daily open	0.592

Trends
Daily SMA20	0.5927
Daily SMA50	0.6076
Daily SMA100	0.6121
Daily SMA200	0.6209

Levels
Previous Daily High	0.5936
Previous Daily Low	0.5884
Previous Weekly High	0.5961
Previous Weekly Low	0.5847
Previous Monthly High	0.6219
Previous Monthly Low	0.5885
Daily Fibonacci 38.2%	0.5916
Daily Fibonacci 61.8%	0.5904
Daily Pivot Point S1	0.589
Daily Pivot Point S2	0.5861
Daily Pivot Point S3	0.5838
Daily Pivot Point R1	0.5942
Daily Pivot Point R2	0.5965
Daily Pivot Point R3	0.5994

Author

Lallalit Srijandorn

FXStreet

Lallalit Srijandorn is a Parisian at heart. She has lived in France since 2019 and now becomes a digital entrepreneur based in Paris and Bangkok.

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