- The NZD / USD is rising sharply after last week’s slide.
- The positive risk sentiment helps the kiwi erase its losses on Monday.
- The US Dollar Index remains in negative territory ahead of US PMI data.
The pair NZD / USD it closed the previous five trading days in negative territory and started the new week in recovery mode. At time of writing, the pair was up 0.68% on the day at 0.6872.
NZD Capitalizes on Risk Appetite Flows, RBNZ Comments
Market optimism at the beginning of the week is helping the kiwi to gain traction. Although no high-level macroeconomic data was released from New Zealand, the strong rally seen in major stock indices in Asia provided a boost to the NZD / USD.
Additionally, Reserve Bank of New Zealand (RBNZ) chief economist Yuong Ha noted on Monday that the Delta variant is not a game changer regarding the political outlook despite generating some economic uncertainty.
On the other hand, the dollar is struggling to find demand amid a strong appetite for risk. The US Dollar Index is currently losing 0.2% on the day at 93.27. Later in the session, IHS Markit will release preliminary August manufacturing and services PMI reports for the US.
Meanwhile, the major Wall Street indices are still on track to start the day higher, suggesting that risk flows are likely to make it harder for the dollar to erase its losses.
On Tuesday, New Zealand’s second quarter retail sales data will be released.
Technical levels
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