NZD/USD pulls back below 0.7350 as US dollar gains broadly
- John Williams, San Francisco Federal Reserve President, sees median interest rates in the US hovering between 3% and 4% by 2020.
- Better-than-expected US housing and industrial data support the US dollar.
- Earlier in Asia, the Chinese Gross Domestic Product came in-line with expectations but failed to impress NZD bulls.
The NZD/USD is trading at around 0.7334 down 0.32% on Tuesday as the US dollar has staged a strong rebound in the European session.
There are four Fed’s officials’ speeches on Tuesday. Coming up is Patrick Harker, President of the Federal Reserve Bank of Philadelphia. He will be speaking at Saint Joseph's University in Philadelphia at 15:00 GMT.
The US Dollar Index is now trading above 89.50 after seeing a low at 89.23 earlier in the European session. Traders are shifting their focus away from the geopolitical tensions with Syria, Russia and China to the earnings season.
Further supporting the positive sentiment on the buck are the comments made earlier by John Williams, the San Francisco Federal Reserve President who sees median interest rates in the US hovering between 3% and 4% by 2020.
Earlier, better-than-expected US housing and industrial data further collaborated to USD strength.
In the Asian session, the Chinese Gross Domestic Product came out mainly in-line with expectations while the Retail Sales data was above expectations. However, it was not enough to bring the kiwi above the 0.7400 handle and investors sold the NZD. Since China is New-Zealand’s top trading partner, Chinese data affects the NZD.
NZD/USD 4- hour chart
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The NZD is currently under pressure. Support lies at 0.7323 swing high and at 0.7244 swing low while resistance is seen at the 0.7400 handle and 0.7438 swing high.
Author
Flavio Tosti
Independent Analyst
