NZD/USD consolidates losses above 0.6300 ahead of US PMI data

• China doesn’t think coronavirus outbreak is at turning point.
• US Dollar Index retreats to 99.70 area on Friday.
• Markit’s US Manufacturing and Services PMI coming up in American session.

The NZD/USD pair continued to push lower on Friday and touched its lowest level since mid-October at 0.6303 before going into a consolidation phase. As of writing, the pair was trading at 0.6311, down 0.27% on a daily basis.

In the absence of significant macroeconomic data releases during the Asian trading hours, the sour market mood forced the risk-sensitive NZD to continue to weaken. Additionally, Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr said that the RBNZ needs to be prepared for the unexpected and added that he was happy with the policy rate for the time being.

Meanwhile, “the turning point of the coronavirus outbreak in China has not come yet,” China’s Politburo Standing Committee noted on Friday, as reported by the Chinese state television, to further weigh on the sentiment ahead of the American session.

Focus shifts to US PMI data

On the other hand, the US Dollar Index (DXY) is staging a technical correction following the sharp upsurge witnessed this week and seems to be helping the pair limit its losses for the time being.

Ahead of the IHS Markit’s preliminary Manufacturing and Services PMI reports for the US, the DXY,ü which touched a multi-year high of 99.91 on Thursday, is down 0.2% on the day at 99.69.

Technical levels to watch for