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  • NZD/USD stages a decisive recovery in American session.
  • US Dollar Index drops into the negative territory, holds above 91.00.
  • Nonfarm Payrolls in US increased by 49K in January.

The NZD/USD pair dropped below 0.7150 during the European trading hours but reversed its course in the second half of the day with the greenback coming under strong selling pressure. As of writing, the pair was up 0.7197, rising 0.6% on a daily basis. With Friday’s sharp upsurge, NZD/USD now remains on track to end the week in the positive territory. 

DXY turns south after dismal NFP data

The monthly data published by the US Bureau of Labor Statistics revealed on Friday that Nonfarm Payrolls (NFP) in the US increased by 49,000 in January. Although this print wasn’t too far off from the market expectation of 50,000, the significant downward revision to December’s reading, from -140K to -227K, caused the USD to weaken against its rivals.

Other data from the US showed that the Goods and Services Trade Balance in December arrived at -$66.6 billion, compared to analysts’ estimate of $65.7 billion.

The US Dollar Index (DXY), which touched its highest level in more than two months at 91.60, was last seen losing 0.45% on a daily basis at 91.10.

Commenting on the US jobs report, “the muted 49,000 increase in non-farm payrolls in January illustrates that the recent wave of COVID-19 cases is still weighing on the economy,” said Capital Economics analysts. “But with infections now dropping back sharply and the recent fiscal boost set to feed through, we expect employment growth to rebound over the coming months.”

Technical levels to watch for