NZD/USD recover modestly, trades around 0.7100 ahead of US data
- NZD/USD dropped to a daily low of 0.7080 in the early European session.
- US Dollar Index clings to modest gains above 92.60.
- Focus shifts to mid-tier data releases from the US.
After closing the first two days of the week in the negative territory, the NZD/USD pair extended its slide and touched a six-day low of 0.7081 in the early European session before staging a modest rebound. As of writing, the pair was virtually unchanged on the day at 0.7098.
Risk-off flows continue to support USD
The broad-based USD strength since the beginning of the week is making it difficult for NZD/USD to gain traction. The US Dollar Index is currently rising 0.16% on the day at 92.68. In the absence of significant fundamental drivers, the risk-averse market environment is helping the greenback find demand on Wednesday. Reflecting the dismal mood, major European equity indexes are down between 0.6% and 0.9%.
Later in the session, the IBD/TIPP Economic Optimism Index for September, July JOLTS Job Openings will be featured in the US economic docket. Additionally, the US Federal Reserve will release its Beige Book at 1800 GMT. New York Federal Reserve President John Williams is also scheduled to deliver a speech at 1710 GMT.
During the Asian trading hours on Thursday, Manufacturing Sales data for the second quarter from New Zealand will be looked upon for fresh impetus.
Technical levels to watch for