- NZD/USD is struggling to preserve its bullish momentum on Wednesday.
- US Dollar Index tries to build on Tuesday’s recovery gains.
- Focus shifts to Fed speakers, ADP Employment Change data from US.
The NZD/USD pair capitalized on risk flows on Wednesday and climbed to its highest level since July 2019 at 0.6789. However, the broad-based USD strength made it difficult for the pair to push higher ahead of the American session. As of writing, NZD/USD was up 0.06% on the day at 0.6761.
The sharp upsurge witnessed in the major European equity indexes reflect a risk-on market environment and help the risk-sensitive NZD stay resilient against its major rivals. As of writing, Germany’s DAX 30 was up 2.4% on the day and the S&P 500 futures were gaining 0.75%.
USD stays strong as focus shifts to ADP jobs report
In the early trading hours of the American session, the ADP Employment Change data from the US will be watched closely by the market participants.
Investors expect employment in the private sector to increase by 950,000 in August. The upbeat Manufacturing PMI data on Tuesday helped the greenback gather strength. We could see a similar market reaction if the ADP reading beats analysts’ estimate and NZD/USD could start pushing lower. Ahead of this data, the US Dollar Index is up 0.25% on the day at 92.54.
Moreover, Cleveland Federal Reserve President Loretta Mester and NY Fed President John Williams are scheduled to speak later in the day.
The ANZ Commodity Price will be released from New Zealand during the Asian session on Thursday.
Technical levels to watch for
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