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  • The spot benefits from coronavirus-led broad USD selling.
  • Treasury yields collapse boost the demand for higher-yielding NZD.
  • Kiwi looks to retest multi-day tops ahead of US payrolls.

Amid the coronavirus-led market panic, the NZD/USD pair bounces back above the 0.6300 level, as the bulls take advantage of broad-based US dollar sell-off.

The market mood remains sour, as the number of COVID-19 cases in the US grows rapidly while California already declared a state of emergency. Investors sold-off risky assets such as the US stocks, oil and Wall Street futures and rushed to the safe-havens, gold, US bond, ensuing a deep sell-off in the US Treasury yields that threw the greenback broadly under the bus.

Not to forget, this week’s emergency Fed rate cut and increased expectations of another rate cut this month add to the weight on the buck, as USD index dives to a new two-month low near 96.50.

Meanwhile, the steep losses in the US Treasury yields made the higher-yielding Kiwi more attractive to the investors. Therefore, the spot manages to stand resilient despite the coronavirus-led havoc across the financial markets. The Kiwi traders ignored the sharp fall in New Zealand’s Q4 Construction Work Done data released in the last hour.

Looking ahead, the main focus will be on the US payrolls data due later in the NA session at 1330 GMT. Markets will continue to watch out for fresh virus updates and its impact on the risk sentiment.

NZD/USD technical levels to consider