- NZD/USD remains on track to snap its three-day losing streak.
- US Dollar Index falls sharply during American trading hours.
- Upbeat market mood provides a boost to the NZD.
The NZD/USD pair closed in the negative territory for the second straight time last week but staged a decisive recovery on Monday and erased the majority of the losses it suffered during that period. As of writing, the pair was up 1.33% on the day at 0.6492.
Earlier in the day, the data from New Zealand showed that Credit Card Spending in May declined by 21.1% on a yearly basis. This reading followed April’s drop of 49.1% and showed a rebound in consumer spending. Meanwhile, the People’s Bank of China (PBOC) left its policy rate, one-year Loan Prime Rate (LPR), unchanged at 3.85% as expected.
NZD/USD pushes higher on USD selloff
After rising modestly during the first half of the day, the broad-based selling pressure surrounding the USD allowed NZD/USD to extend its rally.
Rising equity indexes in the US on Monday made it difficult for the greenback to find demand and stay resilient against its rivals. Furthermore, the upbeat market mood helped the risk-sensitive kiwi continue to gather strength.
The US Dollar Index, which closed the previous four trading days in the positive territory, fell sharply during the American session and is now down 0.62% on the day at 97.05.
The only data from the US revealed that the Federal Reserve Bank of Chicago’s National Activity Index jumped to 2.61 in May from -17.89 in April.
There won’t be any significant macroeconomic data releases from New Zealand on Tuesday. Later in the day, investors will be keeping a close eye on the Markit’s Manufacturing and Services PMI figures for the US.
Technical levels to watch for
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