NZD/USD looks to close the day at weekly highs a little below 0.68

After closing the previous day modestly higher, the NZD/USD pair started the day on a positive note boosted by the inflation data from New Zealand. With the greenback coming under selling pressure in the second half of the day, the pair extended its daily rally and touched a fresh weekly high of 0.6799 before going into a consolidation phase. As of writing, the pair was up 0.6% on the day at 0.6790.

Earlier today, the Statistics New Zealand reported that the annual inflation, measured by the Consumer Price Index (CPI), stayed unchanged at 1.9% in Q4 to beat the market estimate of 1.8% and helped the kiwi outperform its rivals. Commenting on the data, "We expect a gradual pick-up in inflation over the next few years, though it will be some time before the RBNZ needs to respond with higher interest rates,” Westpac analysts said.

Additionally, hopes of the U.S. - China trade conflict coming to an end by the March deadline seems to be allowing the trade-sensitive currencies such as the AUD and the NZD. Just recently, President Trump said that the U.S. was doing well in trade negotiations with China.

On the other hand, the US Dollar Index lost its traction in the NA session to provide an additional boost to the pair. As we approach the end of the day, the DXY was down 0.18% on the day at 96.13.

Key technical levels