NZD/USD drops to lowest in almost two weeks at the 0.6630 area

• Kiwi under pressure amid risk aversion and ahead of RBNZ.
• NZD/USD negative tone prevails, next barrier at 0.6600.

The NZD/USD pair turned to the downside after reaching a daily high at 0.6686. Recently it bottomed at 0.6630, the weakest level since September 9. As of writing, it is trading slightly above the lows, under pressure.

A stronger US dollar across the board pushed the pair lower. The moves around the greenback are driving price action in the currency market. It continues to outperform amid risk aversion. Equity prices in Wall Street are mixed, but holding onto Monday’s losses.

The kiwi is long ground versus the US dollar and remains steady against the Australian dollar ahead of the Reserve Bank of New Zealand (RBNZ) meeting on Wednesday.

No change in monetary policy is expected from the RBNZ. “Data has been to the strong side, but the RBNZ will bank that without reaction. The RBNZ will reiterate that it intends to provide substantial monetary stimulus for as long as necessary and will remind us that it is preparing to deploy a negative OCR combined with cheap funding for banks, in case this is required in the future”, explained analysts at Westpac.

In the US, economic data came in above expectations on Tuesday (Existing Home Sales and Richmond Fed), having no impact on the US dollar.  Fed’s Chair Powell and Treasury Secretary Mnuchin are testifying at the House Financial Services Committee.

Technical levels