NZD/USD in the 0.6360 region in choppy trade, awaiting US CPI.

• The New Zealand dollar failed to advance despite risk appetite.
• The US dollar remains weak amid growing speculation about a softer CPI.
• The reopening of China could strengthen the outlook for the NZD in the near term.

The NZD/USD draws successive doji candlesticks on the charts, suggesting that neither buyers nor sellers are in controlahead of Thursday’s release of the US Consumer Price Index (CPI). Meanwhile, the NZD/USD pair is trading at 0.6374, around its opening price after hitting a daily high of 0.6388.

Wall Street will end the session with solid gains of between 0.56% and 1.24%. The NZD/USD pair continues to trade up and down as investors prepare for the release of fundamental US economic data. Consensus estimates that headline inflation in the US, known as Consumer Price Index (CPI), would fall to 0% MoM, while YoY data is expected to slow from 7.1% to 6.5%. Excluding inflation from volatile elements, core CPI is forecast to rise 0.3%m/m, while the consensus for annual core inflation is 5.7%.

Although the World Bank has revised its global growth forecasts downward, the New Zealand dollar (NZD) remains linked to the Chinese economy. China’s reopening could trigger another rise in commodities. However, according to ANZ Bank, “tightening of world monetary policy in the second half of the year“could help curb commodity inflation.

Meanwhile, the DXY Dollar Index, a gauge of the value of the dollar against a basket of six major currencies, continues to weaken, although it is still hovering around the 103.200 area.

Therefore, the NZD/USD pair could continue to trade sideways as traders prepare for the US economic data release. That being said, the December Building Permits will be announced on the New Zealand (NZ) agenda.

NZD/USD technical levels