NZD/USD struggles to capitalize on risk-on flows, stays in red above 0.64
- US Commerce Secretary Ross confirms 90-day extension to Huawei ban.
- US Dollar Index stays in consolidation following last week's rally.
- Subdued trading action likely to continue in absence of macroeconomic data releases.
After posting weekly losses for the fourth straight week last Friday, the NZD/USD pair started the new week in a calm manner and is now having a tough time setting its next near-term direction. As of writing, the pair was down 10 pips on the day at 0.6417.
US Commerce Secretary Wilbur Ross today said that they will be delaying the ban on Chinese tech giant Huawei to buy supplies from US companies for 90 days. However, the fact that Reuters on Saturday reported on that matter citing Commerce Department sources caused the market reaction to stay muted and didn't allow the trade-sensitive Kiwi to gather strength.
There won't be any macroeconomic data releases in the remainder of the day and investors are likely to stay focused on the headlines surrounding the US-China trade dispute.
Coming up later this week
On Tuesday, the bi-weekly Global Dairy Trade auction in New Zealand will be looked upon for fresh impetus. Meanwhile, Statistics New Zealand earlier today reported that the Producer Price Index (PPI) in the second quarter rose 0.5% on a quarterly basis following the 0.5% decline recorded in the first quarter but did little to nothing to impact the pair's action.
Later this week, the FOMC meeting minutes on Wednesday and retail sales data from New Zealand on Thursday are likely to bring the volatility back to markets.
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.
