- Upbeat China data fails to elicit a positive reaction from NZD/USD.
- Both Industrial Production and Retail Sales bettered estimates.
- With China data out of the way, the focus will be on equities.
NZD/USD is keeping gains near 0.67 following the release of a better-than-expected China macro data.
Industrial Production rose 5.6% year-on-year versus expectations for a 5.1% rise and up from the preceding month’s 4.8% increase.
As represented by Retail Sales, China’s consumer spending rose 0.5% year-on-year in August, beating the forecast of 0% and up from July’s -1.1% reading.
The data is likely to reinforce expectations for a faster recovery in the world’s second-largest economy. As such, it is positive for metals and commodity-linked currencies like the NZD.
So far, however, the data has failed to bolster the bid tone around NZD/USD. The currency pair is trading near 0.67 – up just five pips since the release of China data. Before that, the pair recovered from 0.6683 to 0.6695 on broad-based dollar weakness.
The Kiwi may post stronger gains above 0.67 during the day ahead if the upbeat China data propels equities higher, weakening the anti-risk US dollar.
The People’s Bank of China’s decision to add a net 230 billion yuan into the system could also fuel gains in risk assets and NZD.
Technical levels