- Downbeat daily prices, concerns of global economic weakness trigger the Kiwi pullback.
- No major data from New Zealand highlights AU GDP and the US data/events for fresh direction.
Sluggish data at home and doubts over global economic growth triggered the NZD/USD pair’s pullback to 0.6600 at the start of Wednesday’s Asian session as traders await fresh catalysts.
The Kiwi pair benefited from the US Dollar (USD) weakness and upbeat first-quarter terms of trade data from New Zealand on Tuesday.
Though, traders were waiting for New Zealand open to react to the latest decline in fortnightly GDT price index to -3.4% versus -2.8% forecast and -1.2% prior.
Adding to the Kiwi’s weakness could be the World Bank’s recent report that lowers down global growth forecast to 2.6% from 2.9% predicted back in January.
The US Federal Reserve policymakers maintained their tone in the latest public appearances. However, the absence of the word “cautious” from Chairman Jerome Powell’s speech grabbed more attention.
Looking forward, New Zealand has no data to release today but first-quarter GDP numbers from its largest customer Australia will be of interest to the Kiwi traders. On the other hand, comments from Fed’s Vice Chair and second-tier data will be on the spotlight from the US.
Technical Analysis
Unless declining below late-May tops near 0.6560, chances of the pair’s further rise towards 50-day simple moving average (SMA) near 0.6645 and then to 0.6685 can’t be denied.
In a case where prices slip under 0.6560, 0.6500, 0.6480 and October 2018 low surrounding 0.6425 should be given proper attention.
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