- NZD/USD remains directionless after the previous day’s risk aversion.
- RBNZ recently proposed the removal of mortgage LVR restrictions to combat the pandemic.
- US President Trump keeps pushing for the phased re-start, risk-off sentiment remains in play.
NZD/USD seesaws in a choppy range between 0.6030 and 0.6045, currently near 0.6040, during the early Asian session on Tuesday. The pair might have been struggling between the mixed catalysts, namely support from the RBNZ and risk aversion-led US dollar strength.
Read: RBNZ: Proposing the removal of mortgage LVR restrictions
The Reserve Bank of New Zealand (RBNZ) recently proposed to remove mortgage loan-to-value ratio (LVR) restrictions for the banks to ward off the negative implications of the coronavirus (COVID-19). The central bank also mentioned that this provides banks and customers certainty that no further changes to LVR requirements will be made for at least one year.
Elsewhere, US President Donald Trump pushed for his plan to restart the economy on the phased manner during this Monday’s task force briefings. The Republican leader also hoped that the Senate will vote on the additional relief package, hinted the previous day, tomorrow.
Amid all these, the US death toll crossed 41,000 on Monday, which in turn triggered protests against the Trump administration in the US.
Also negatively affecting the risk-tone sentiment could be an oil price slump. The WTI’s May contract plunged into the negative territory for the first time in history by being near -$38.00 by the end of Monday’s settlement.
Looking forward, a lack of major data could keep traders waiting for the coronavirus (COVID-19) updates while the RBA minutes may also offer immediate direction to the kiwi pair.
Technical analysis
A short-term rising trend channel favors the kiwi pair’s upside momentum until it stays between 0.6160 and 0.5940.
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