- NZD/USD pair is fluctuating in a narrow channel for second straight day.
- US Dollar Index advances above 97.30 area as Wall Street loses traction.
- New Zealand’s economy is expected to contract by 1% in first quarter.
The NZD/USD pair is moving sideways near mid-0.6400s for the second straight on Wednesday in the absence of significant macroeconomic drivers. As of writing, the pair was virtually unchanged on the day at 0.6447.
Although the US Dollar Index (DXY) seems to have gained traction during the American session, NZD/USD stays relatively quiet.
After starting the day modestly higher, Wall Street’s main indexes fell into the negative territory to reflect a sour market mood. Boosted by risk-off flows, the USD started to gather strength against its rivals and the DXY was last up 0.3% on the day at 97.32.
Eyes on NZ GDP data
In the early trading hours of the Asian session, Statistics New Zealand will release the Gross Domestic Product figures for the first quarter. Markets expect the economy to contract by 1% on a quarterly basis.
Previewing the data, “the market mood at the time of the publication is likely to impact the reaction,” said FXStreet analyst Yohay Elam. “An upbeat figure will compound a rally based on optimism, while a depressing GDP figure could exacerbate a sell-off of the kiwi based on global gloom.”
Later in the day, the weekly Initial Jobless Claims and the Federal Reserve Bank of Philadelphia’s Manufacturing Survey will be featured in the US economic docket.
Technical levels to watch for
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