- NZD/USD extends pullback from June month high of 0.6585.
- China’s CPI grew more than 2.5% to 2.7% but PPI dropped below -3.2% to -3.7% on YOY.
- Australian states keep battling to tame the virus spread, US figures cross 3.0 million.
- New Zealand’s ANZ data have been upbeat off-late but failed to ignore the risk reset.
NZD/USD drops to 0.6565, down 0.20% on a day, amid the Asian session on Thursday. The pair’s latest weakness could be traced from its failures to cross June month’s top as well as mixed inflation numbers from China. In doing so, the kiwi pair ignores upbeat early economic signals from the Australia and New Zealand Banking Group (ANZ).
China’s headline Consumer Price Index (CPI) YoY matches 2.5% expected figures in June while the monthly figures slipped below 0.0% forecast to -0.1%. Further, the Producer Price Index (PPI) extended the deflationary pressure despite recovering from -3.2% forecast to -3.0.
Read:China Consumer Price Index, YoY for June: 2.7% vs 2.5% expected
On the other hand, preliminary readings of ANZ Business Conditions for July recovered from -34.4 to -29.8 whereas ANZ Activity Outlook also improved from -25.9 to -6.8. Earlier during the day, ANZ Truckometer data for June mentions the rise of 14.5% in Heavy Traffic whereas Light Traffic Index surged 28%.
Although domestic fundamentals are brighter, the kiwi might be taking a hit as its largest customer Australia is struggling to tame the coronavirus (COVID-19) resurgence. After recalling the lockdown in Melbourne and delaying further easing of lockdown restrictions in the Australian Capital Territory, the Aussie policymakers recently extended the state of emergency until the end of August.
Elsewhere, the US cases surge over 3.0 million with the latest addition of 59,655 whereas figures from China stick to zero for the third day in a row. Further, Tokyo also snaps the seven-day run-up in numbers above 100 with recent statistics around 75 new cases.
It’s worth mentioning that the mix of data and virus woes join the US-China tussle, recently over the Hong Kong Security bill to probe the commodity-linked currencies’ strength. However, the US dollar weakness helps the bulls.
Market’s risk-tone refrain from extending the previous day’s mild optimism as S&P 500 Futures dwindles and so does the US 10-year Treasury yields. Further, stocks in New Zealand suggest mark over 1.0% loss amid a likely easing of virus-led aides and fears that the pandemic might reach the safe nation with the influx of locals from abroad. As a result, the traders will keep eyes on the US Jobless Claims and qualitative risk catalysts for fresh impetus.
Technical analysis
Only if the pair slips below June 23 top near 0.6530, it can recall the sellers targeting 0.6500. Otherwise, the bulls will keep attacking 0.6585 to aim for the late-January top near 0.6630.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD retreats to 1.0850 area as US Dollar rebounds

EUR/USD has extended its slide toward 1.0850 in the American session. Profit-taking ahead of the weekend and the negative shift witnessed in risk sentiment seems to be helping the US Dollar gather strength against its rivals, weighing on the pair.
GBP/USD trades on the back foot below 1.2400

GBP/USD is having a difficult time gathering recovery momentum and trading in negative territory below 1.2400 on Friday. Although the data from the US showed that PCE inflation continued to soften in December, the US Dollar holds its ground heading into the weekend.
Gold struggles to hold above $1,930

Gold price has lost its traction and declined below $1,930 during the American trading hours. The benchmark 10-year US Treasury bond yield clings to modest daily gains above 3.5% ahead of the weekend, not allowing XAU/USD to gain traction.
Is the dramatic rise in whale activity in AAVE, MATIC and DYDX a sell signal?

AAVE, MATIC and DYDX price rallied alongside large market capitalization cryptocurrencies Bitcoin and Ethereum in January. Experts at the crypto intelligence tracker Santiment believe the recent spike in activity by whales on these networks needs to be watched closely.
Breaking: US annual Core PCE inflation declines to 4.4% in December as expected

Inflation in the US, as measured by the Personal Consumption Expenditures (PCE) Price Index, declined to 5% on a yearly basis in December from 5.5% in November, the US Bureau of Economic Analysis reported on Friday.