NZD/USD starts out in early Asia better-bid

NZD/USD bulls in charge on sheer US dollar weakness.
RBNZ rate hikes bets increase, supporting the bird.

Ross J Burland FXStreet

NZD/USD has started out in early Asia in positive territory as the US dollar longs move out ahead of the keenly awaited Jackson Hole event that starts later on Thursday.

At the time of writing, NZD/USD is trading at 0.6973 and is higher on Wednesday's candle by some 0.36%.

NZD/USD drifted on a firm bid from a low of 0.6929 to a high of 0.6983.

''It was again broad USD weakness and steadily gaining global risk appetite that was doing most of the work, with US equities and bond yields both higher,'' analysts at ANZ bank explained.

''But as we have noted throughout the week, local sentiment toward what the world looks like after Delta is very much glass-half-full. Hawkish comments by an RBNZ official yesterday have seen the market jump to price in ~90% odds of a hike by October, and that should help support the carry equation too. But upbeat as it all sounds, we still have to take it one day at a time, as NZ is not yet out of the woods with Delta,'' the analysts concluded.

Meanwhile, traders have probably moved to the sidelines ahead of a keynote speech that is scheduled from the Federal Reserve's chairman, Jerome Powell, on Friday.

As for data, domestically it is quiet, but Thursday's US data calendar will be highlighted by weekly initial jobless claims as well as the first revision to second-quarter Gross Domestic Product.

The Fed's preferred inflation measure will come out before Powell is set to speak on Friday.

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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