NZD/USD struggles to hold above 0.65, looks to post its lowest daily close of 2019
- FOMC says patient approach is appropriate.
- US Dollar Index sits comfortably above 98.
- Trading action is likely to stay subdued in the Asian session.
After dropping to its lowest level since October at 0.6490, the NZD/USD pair staged a weak recovery but failed to hold above the critical 0.65 mark. As the trading action turns choppy in the late American session, the pair moves sideways in a tight range below 0.65, looking to post its lowest daily close of the year.
The sour market sentiment and the lack of positive headlines surrounding the U.S.-China trade conflict on Wednesday didn't allow antipodeans to find demand throughout the day. While speaking at a hearing with U.S. lawmakers, U.S. Treasury Secretary Steven Mnuchin said that the Trump administration was at least a month away from imposing tariffs on roughly another $300 billion worth of Chinese goods and said that he had no current plans to go to Beijing for a new round of trade talks.
In the second half of the day, the US Dollar Index didn't have a difficult time staying in the upper half of its daily range above the 98 mark as the FOMC didn't provide any surprises regarding the policy outlook. In the minutes of its May meeting, the FOM said that the patient approach to determining future adjustments to target range was still appropriate and noted that many participants viewed the recent dip in PCE inflation as likely to be transitory.
There won't be any macroeconomic data releases from New Zealand nor China during the Asian trading hours and the pair is likely to make technical fluctuations in a tight range.
Technical levels to consider
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.
