- NZD/USD moves sideways in the initial Asian trading hours.
- US Treasury yields move slightly higher underpinning the demand for the US dollar.
- Risk on mood lends support to kiwi.
The NZD/USD/ pair treads water on Wednesday in the early Asian trading session. The pair extended the previous day’s sluggish price movement.
At the time of writing, the NZD/USD pair trades at 0.7253, down 0.02% for the day.
The rebound in the US Dollar Index (DXY) from the lower levels around 89.80 and is inching towards the 90 mark and keeps pressure on NZD/USD. The US dollar follows the move in the US 10-year benchmark yields which rose to 1.60% with gains of 0.83%.
The US Treasury yields rise amid economic optimism while fears about inflation still persist. The ISM Manufacturing PMI rose to 61.2 in May beating the market expectation at 60.9% and the Market Manufacturing PMI was revised higher to a new record.
On the other hand, Kiwi remained higher post-RBNZ hawkish forward guidance on rate hike expectations. However, the Organisation for Economic Cooperation and Development pointed to increased vaccination drives in New Zealand.
Meanwhile, the latest ANZ business outlook survey showed the New Zealand economy is struggling to keep up with demand, while cost and inflation pressure continue to build.
It is worth mentioning that S&P 500 Futures are trading at 4,204, down 0.05% for the day.
As for now, traders are bracing up for New Zealand Terms of Trade data and several Fed speeches to gauge the market sentiment.
NZD/USD Additional Levels
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