NZD/USD consolidating a turbulent flight as the US dollar falls back in line
- NZD/USD has settled in around the 0.6530 territories as US data and Fed prospects send the dollar back into line.
- The RBNZ is the next major hurdle for the kiwi, at risk of the implication of negative rates.
NZD/USD is currently trading at 0.6536 in a consolidating and quiet start to Friday's session.
However, the bird is exhausted after flying around in a whirlwind over the past couple of days, losing its course a few times over this week.
The US dollar has been attempting to break higher from cycle lows, albeit failing to deliver and leaving the question hanging over the market as to whether we have seen the last of bulls armoury.
The September Federal Reserve meeting will be hanging over the greenback like a guillotine and so long as the US data and coronavirus continues to spell a protracted recession, markets will presume that the Fed will maintain its easing bias.
In the US session, the Weekly US Jobless Claims on Thursday that once again was surging to over 1 million, helping the dollar solidify gains it made on Wednesday.
The Labor Department reported on Thursday that the number of Americans filing a new claim for unemployment benefits rose unexpectedly to 1.106 million for the week ended Aug. 15, from the 971,000 the week before.
The previous week's level had marked the first time since March that new claims had registered below 1 million.
Meanwhile, the domestic situation is not looking bird positive either and, as analysts at ANZ bank point out, ''from here on in, our focus remains on RBNZ policy settings and the threat of negative rates will ultimately cap the NZD.''
Despite the deeply negative income implications of the COVID-19 crisis, many countries’ housing markets are doing rather well, including New Zealand’s.
NZD/USD levels