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  • NZD/USD probes September 18 high following upbeat data from New Zealand.
  • RBNZ Inflation Expectations grew past-1.43% to 1.59% QoQ for Q4 2020.
  • Trading sentiment remains positive with US election updates favoring Biden’s victory.
  • Bulls may catch a breather ahead of US NFP.

NZD/USD refreshes the highest levels since the mid-September, currently easing to 0.6775, while flashing 0.05% intraday gains on early Friday. The quote recently surged to 0.6785 amid market optimism and welcome numbers from the RBNZ Inflation Expectations.

The Reserve Bank of New Zealand’s (RBNZ) Inflation Expectations crossed the previous 1.43% mark to 1.59% QoQ for the fourth quarter (Q4) of 2020. This helps the NZD/USD bulls amid the currently trading positive mood by cutting the odds of any rate cuts from the New Zealand central bank during the next week.

Read: RBNZ Survey: NZ inflation expectations accelerate in Q4, Kiwi unimpressed

Other than the data, an upbeat trading environment also favors the kiwi buyer as Democratic candidate for the US presidency, Joe Biden, leads the race in 2020 elections. With Democrats’ stimulus-friendly image, investors jump on the riskier assets and commodities while expecting easy money days ahead.

On the contrary, the coronavirus (COVID-19) woes in the US and Europe challenges the positive sentiment. The US recently registered a record daily new inflations with over 109,000 cases on Thursday.

Against this backdrop, S&P 500 Futures print mild losses whereas stocks in Asia-Pacific keep small gains. Further, US 10-year Treasury yields also struggle for clear direction around 0.77% after dropping to the lowest in three weeks on Thursday.

Looking forward, vote counts from the US will keep entertaining the momentum traders ahead of America’s October month employment data. Forecasts suggest mixed feelings with a weak NFP and receding Unemployment Rate to 600K and 7.7% respectively.

Read: Nonfarm Payrolls Preview: Encouraging data but little action expected

Technical analysis

Overbought RSI conditions may again challenge the NZD/USD bulls around the 0.6800 threshold. Alternatively, October’s peak near 0.6725 offers immediate support.