NZD/USD struggles to pull away from 2021 lows, trades near 0.6900
- NZD/USD continues to suffer losses following Monday's drop.
- US Dollar Index rises for the fourth straight trading day.
- Wall Street's main indexes look to rebound on Tuesday.
The NZD/USD pair lost more than 60 pips on Monday and extended its slide on Tuesday to touch its lowest level since November at 0.6888. As of writing, the pair was trading near 0.6900, losing 0.58% on a daily basis.
DXY holds near 93.00, eyes on Wall Street
The risk-averse market environment at the start of the week provided a boost to the greenback while weighing on the kiwi. Reflecting the broad-based USD strength, the US Dollar Index (DXY) reached its highest level at 93.03 before closing the day with modest gains at 92.82 on Monday. Currently, the DXY is up 0.16% at 92.97.
However, US stock index futures are up nearly 0.5% during the European session, suggesting that a rebound in Wall Street's major indices could help the sentiment improve and keep the USD's gains limited in the second half of the day.
On the other hand, the benchmark 10-year US Treasury bond yield, which lost more than 7% on Monday, is sitting at its lowest level in more than five months at 1.167%, falling 2%. In case US T-bond yields fail to stage a rebound, US stocks could find it difficult to gain traction.
June Building Permits and Housing Starts data will be featured in the US economic docket on Tuesday. Nevertheless, these figures are unlikely to trigger a significant market reaction.
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.
