NZD/USD juggles around 0.6060 after a soft recovery, US Durable Goods Orders in spotlight


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  • NZD/USD has turned sideways around 0.6060 posts a soft recovery ahead of US Durable Goods Orders.
  • Fed policymakers are anticipated to capitalize on tight credit conditions to weigh pressure on inflation rather than hiking interest rates further.
  • RBNZ Silk advised holding rates ahead and remaining data-specific.

The NZD/USD pair is displaying a back-and-forth action after a soft recovery around 0.6070 in the early London session. The Kiwi asset is expected to extend recovery as the US Dollar Index (DXY) has shifted into the bearish trajectory amid bets favoring a pause in the rate-hike spell by the Federal Reserve (Fed).

S&P500 futures have trimmed some losses added in Asia, portraying a minor recovery in the risk appetite of the market participants. A decline in the US Dollar Index (DXY) has improved the appeal for US equities. However, the overall market mood is expected to remain cautious as the $31.4 trillion US borrowing cap limit has not increased yet.

The USD index has come under pressure as the Federal Reserve (Fed) policymakers are anticipated to capitalize on tight credit conditions to weigh pressure on inflation rather than hiking interest rates further.

For further guidance, US Durable Goods Orders data will be keenly watched. April’s Durable Goods Orders are seen contracting by 1.0% vs. an expansion by 3.2%. A contraction in the economic data indicates poor demand, which would have a ripple effect on US Consumer Price Index (CPI).

Investors should note that the US economy is facing issues of persistence in core inflation more than the headline price index. A contraction in durable goods demand would release some heat from core inflation and would be a more relieving factor for the Fed.

On the New Zealand Dollar front, Reserve Bank of New Zealand´s Assistant Governor Karen Silk noted that Cyclone Gabrielle was less inflationary than first feared and stated that rates need to stay on hold for an extended period. She said that they must be watchful of over-tightening policy and that the RBNZ can hold now and sees what develops.

Investors should note that RBNZ Governor Adrian Orr raised its Official Cash Rate (OCR) by 25 basis points (bps) to 5.5% this week.

NZD/USD

Overview
Today last price 0.607
Today Daily Change 0.0007
Today Daily Change % 0.12
Today daily open 0.6063
 
Trends
Daily SMA20 0.6233
Daily SMA50 0.6226
Daily SMA100 0.627
Daily SMA200 0.6154
 
Levels
Previous Daily High 0.6115
Previous Daily Low 0.6043
Previous Weekly High 0.6306
Previous Weekly Low 0.6117
Previous Monthly High 0.6389
Previous Monthly Low 0.6111
Daily Fibonacci 38.2% 0.6071
Daily Fibonacci 61.8% 0.6087
Daily Pivot Point S1 0.6032
Daily Pivot Point S2 0.6002
Daily Pivot Point S3 0.596
Daily Pivot Point R1 0.6104
Daily Pivot Point R2 0.6146
Daily Pivot Point R3 0.6176

 

 

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