- China to release Industrial Production and Retails Sales data.
- Hopes of progress in US-China trade talks help antipodeans find demand.
- Broad USD strength limits pair's upside on Wednesday.
The NZD/USD pair fluctuated sharply in the early trading hours of the American session on surprise headlines surrounding the US-China trade dispute but steadied near the 0.6450 handle in the last hour and now remains on track to close the day flat ahead of critical macroeconomic data releases from China.
Following reports of a phone call between high level Chinese and American trade negotiators, the US Trade Representative's office on Tuesday announced that the Trump administration has agreed to delay additional 10% tariffs on some Chinese products including a wide range of consumer electronics and revived hopes of the trade war coming to an end.
NZD struggles to capitalize on trade optimism
With the initial market reaction, the trade-sensitive Kiwi gathered strength and lifted the pair to a daily high of 0.6470. However, this development was assessed as a factor that would allow the Federal Reserve to refrain from making a large rate cut in September and helped the Greenback outperform its rivals.
Moreover, the 10-year US Treasury bond yield gained traction on these headlines and rose more than 3% to support the dollar's recovery. The US Dollar Index was last up 0.4% on the day at 97.80.
In the early trading hours of the Asian session, Retail Sales and Industrial Production data from China will be looked upon for fresh impetus. Markets expect Retail Sales to increase by 8.6% on a yearly basis in July and a stronger-than-expected reading could cause the pair to rally in the first half of the day on Wednesday.
Technical levels to watch for
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 toward 1.0650 after PMI-inspired rebound
EUR/USD loses traction and retreats to the 1.0650 area after rising toward 1.0700 with the immediate reaction to the upbeat PMI reports from the Eurozone and Germany. The cautious market stance helps the USD hold its ground ahead of US PMI data.
GBP/USD fluctuates near 1.2350 after UK PMIs
GBP/USD clings to small daily gains near 1.2350 in the European session on Tuesday. The data from the UK showed that the private sector continued to grow at an accelerating pace in April, helping Pound Sterling stay resilient against its rivals.
Gold flirts with $2,300 amid receding safe-haven demand
Gold (XAU/USD) remains under heavy selling pressure for the second straight day on Tuesday and languishes near its lowest level in over two weeks, around the $2,300 mark in the European session. Eyes on US PMI data.
Here’s why Ondo price hit new ATH amid bearish market outlook Premium
Ondo price shows no signs of slowing down after setting up an all-time high (ATH) at $1.05 on March 31. This development is likely to be followed by a correction and ATH but not necessarily in that order.
US S&P Global PMIs Preview: Economic expansion set to keep momentum in April
S&P Global Manufacturing PMI and Services PMI are both expected to come in at 52 in April’s flash estimate, highlighting an ongoing expansion in the private sector’s economic activity.