- NZD/USD lost its traction and dropped to a daily low of 0.6517.
- Broad-based USD strength continues to weigh on NZD/USD.
- DXY climbs to fresh weekly highs as focus shifts to PMI data.
The NZD/USD pair came under renewed bearish pressure in the last hour and dropped to a daily low of 0.6517. As of writing, the pair was down 0.1% on the day at 0.6527.
USD heads into American session on a strong note
A fresh USD buying-wave seems to be weighing on the pair on Friday. The US Dollar Index, which posted modest losses on Thursday, gained traction and rose to its highest level in a week at 93.40. Although there were no apparent drivers behind that move, the risk-off market environment seems to be helping the USD find demand. Reflecting the dismal mood, Germany’s DAX 30 is losing more than 1% on a daily basis and the S&P 500 futures are down 0.55%.
Later in the day, the IHS Markit will release the preliminary Manufacturing and Services PMI for the US. Investors expect the PMI data to show that the business activity in both the manufacturing and the service has expanded at a more robust pace than they did in July.
If the PMI figures fall short of expectations and weigh on market sentiment, the USD could continue to gather strength against its peers and drag the pair toward 0.6500. On a weekly basis, the pair is trading in the negative territory and remains on track to post losses for the third straight week.
Technical levels to watch for
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