- NZD/USD remains modestly flat despite upbeat Trade Balance.
- Import/export numbers lag behind the consensus.
- The US-China trade developments and second-tier US data will be followed for fresh impulse.
Even after witnessing better than forecast New Zealand Trade Balance numbers, the NZD/USD pair remains modestly flat near 0.6700 during early Wednesday.
In addition to beating the monthly forecast of $100 million, by being at $365 million, June month Trade Balance number rose beyond $-5.105 billion consensus for YoY to -$4.904 billion figure. Further, Imports lagged behind $5.20 billion expectations to $4.65 billion whereas exports also fell short of $5.29 billion expected to $5.01 billion.
While broad US Dollar (USD) strength offered initial weakness to the Kiwi pair, Reserve Bank of New Zealand’s (RBNZ) hint towards likely future use of the unconventional monetary policy tools enabled the bears to print the mark of G-10 loser on the face of the pair.
On the trade front, the US delegates led by the Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin would be traveling to China next week for the first face-to-face meeting after the G20.
Recent communication by the US Economic Adviser Larry Kudlow suggests China is ready to increase imports of the US agriculture products. Further, the US President Donald Trump is also agreeing to top tech leaders’ request to fasten the licensing process for allowing them to sell more products to China’s Huawei.
Investors may now look forward to the US economic calendar and further developments surrounding the US-China trade deal in order to determine near-term market direction.
An upside clearance of 0.6716 mark including 200-day exponential moving average (EMA) can trigger the quote’s fresh rise targeting 0.6730 and 0.6750 while July 19 low around 0.6790 and 0.6800 round-figure might please buyers afterward. Alternatively, 21-day EMA level of 0.6690 offers immediate support to prices, a break of which can recall 100-day EMA level of 0.6672 and July 09 high around 0.6630 on the chart.