NZD/USD slides to two-week lows, inches closer to 0.63 handle
- The NZD/USD pair falls for the sixth straight day.
- US Dollar Index sits above the 98.50 mark ahead of today's data.
- New Zealand's GDT auction is expected to yield a 1.7% decline in the Price Index.
After breaking below the 0.64 mark on Monday, the NZD/USD pair extended its slide and touched its lowest level in a week at 0.6321 on Tuesday. As of writing, the pair was down 0.26% on a daily basis at 0.6327.
The lack of major developments surrounding the US-China trade dispute and the absence of macroeconomic data releases from New Zealand allowed the USD's market valuation and the risk sentiment to drive the pair's action.
The flight-to-safety that was triggered by the rising geopolitical tensions in the Middle East amid the attack on Saudi Arabia's oil facilities weighed on the demand for the risk-sensitive NZD.
USD preserves its strength
On the other hand, the USD capitalized on risk-off flows and the US Dollar Index (DXY) on Monday retraced all of last week's drop to keep the bearish pressure on the pair intact. Ahead of today's Industrial Production and the Capacity Utilization data from the DXY is consolidating Monday's gains near 98.60.
Later in the day, the bi-weekly Global Dairy Trade auction in New Zealand will be looked upon for fresh impetus as well. Markets expect the auction to yield a 1.7% decline in the Price Index, which could put additional weight on the NZD's shoulders.
Technical levels to watch for
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
