NZD/USD: Pressured above 0.6000 following PBOC rate decision, risk-off
- NZD/USD bounces off intraday low after PBOC rate cut.
- The pair earlier failed to cheer NZ CPI data amid fresh risk aversion.
- US coronavirus numbers, challenges to the economic restart question the trade sentiment.
Despite bouncing off intraday low of 0.6008, NZD/USD remains under pressure, down 0.18% on a day around 0.6022, during the Asian session on Monday.
The pair recently took clues from the People’s Bank of China’s (PBOC) rate cuts. The PBOC recently cut one and five-year loan prime rates to 3.85% and 4.65% versus respective prior of 4.05% and 4.75%.
Earlier during the day, New Zealand’s first quarter (Q1) Consumer Price Index (CPI) rose to 2.5% on YoY and 0.8% QoQ versus the respective downbeat forecasts of 1.8% and 0.3% respectively.
Even so, surging coronavirus (COVID-19) numbers from the US, as per Reuters, as well as a lack of agreement to follow the Trump administration’s phased plan for economic restoration, seems to keep the risk-tone heavy.
While portraying the same, the US 10-year treasury yield drop to 0.64% whereas Japan’s NIKKEI declines more than 1.0% to 19,688 by the press time.
Given the lack of major data/events on the economic calendar, except for Chicago Fed National Activity Index, traders will keep eyes on the virus updates for fresh impulse.
Technical analysis
Buyers and sellers jostle between 21-day and 50-day SMA, occupying the area above 0.5965 and below 0.6125 levels respectively.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
