NZD / USD depreciates further, reaching levels below 0.6950

• The NZD / USD extends the decline beyond the 0.7000 to 0.6940 area.
• Rising US yields and risk-scared mood have weighed on the NZD.
• NZD / USD: Below 0.6981, the pair could hit 0.6805 – Credit Suisse.

The New Zealand dollar It has resumed its downtrend from last week’s highs near 0.7100 on Tuesday, breaking the psychological level of 0.7000 to hit intraday lows near 0.6940 so far.

US strength and risk aversion sentiment hurt kiwi

Monday’s recovery attempt, following Friday’s 0.75% reversal from last week’s high of 0.7075, was untracked and the pair resumed its decline on Tuesday. The overall strength of the US dollar, driven by rising US yields, with the hope that the Federal Reserve will begin to reduce its bond buying program, has weighed on the NZD.

Furthermore, the negative market environment with rising energy prices threatening the post-pandemic recovery in Europe and fears about the debt crisis in the Chinese Evergrande Group have increased selling pressure on the risk-sensitive New Zealand dollar. .

NZD / USD: Close Below 0.6981 Could Send Pair Towards 0.6805 – Credit Suisse

According to Credit Suisse’s currency analysis team, a successful break from the recent lows at 0.6981 could increase the negative pressure and push the pair towards 0.6805: “A close below the 50% retracement of the July / August rally and the aforementioned price lows at 0.6988 / 81 would reduce short-term risks within the broader range, with the next support seen at 0.6933 / 29, then 0.6878 (…) We would expect 0.6805 to define the bottom of the range, with our outlook more broad while remaining neutral ”.

Technical levels