- The NZD / USD erased a portion of its daily losses early in the US session.
- The US dollar index struggles to preserve bullish momentum.
- The major Wall Street indices are suffering heavy losses.
The pair NZD / USD It started the new week under downward pressure and fell to its lowest level in three weeks at 0.7006 before making a modest recovery. At time of writing, the pair was down 0.15% on the day at 0.7030.
DXY leans lower as Treasury yields fall
Risk aversion on Monday, due to the Evergrande financial crisis in China, made it difficult for the NZD to find demand. Furthermore, New Zealand data showed that Business NZ’s PSI fell sharply to 35.6 in August from 57.9 in July and caused NZD / USD to remain on the defensive.
Although the dollar gained strength in the first half of the day, falling US Treasury yields appear to be limiting the currency’s rise. The US Dollar Index (DXY), which rose to its highest in a month at 93.45 earlier in the day, currently remains lateralized at 93.27 and the benchmark yield on the 10-year US Treasury bond. it is losing 3% to 1,324%.
Meanwhile, the S&P 500 Index is down 1.6% after the opening bell, suggesting that safe-haven flows are unlikely to allow NZD / USD to take a bullish momentum for the remainder of the day.
On Tuesday, the Westpac New Zealand Consumer Survey for the third quarter will be seen as a new boost. In the meantime, investors will closely monitor the performance of the major Asian stock indices.
Technical levels
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