- NZD / USD is falling for the second day in a row on Friday.
- Data from New Zealand showed an ongoing expansion in the private sector.
- The US dollar index remains in the consolidation phase below 93.00.
The pair NZD / USD It rose to its highest level in nearly 20 months at 0.6916 on Thursday, but spent the second half of the day under heavy downward pressure before closing at 0.6838. In the absence of significant fundamental drivers, the pair extended its correction on Friday and touched a daily low of 0.6811. At time of writing, the NZD / USD was down 0.18% on the day at 0.6825.
Inspired NZD rally loses momentum
The Reserve Bank of New Zealand opted to be neutral on the political outlook earlier in the week and helped the kiwi gain traction against its rivals. However, risk aversion caused the NZD to lose interest and forced the pair to start pushing lower. Major Wall Street indices closed in the red on Thursday and the 10-year US Treasury yield, which gained nearly 20% during the first half of the week, lost 10.5%.
Meanwhile, New Zealand data showed that Business NZ’s October PMI fell to 51.7 from 54 in September, but beat the market expectation of 46.6. This reading showed an ongoing expansion in private sector business activity at a modest pace.
On the other hand, the US Dollar Index continues to fluctuate in a relatively tight range below 93.00 on Friday, helping the NZD / USD limit its losses.
Later in the day, data from the Producer Price Index (PPI) and Consumer Sentiment Index from the US University of Michigan will be considered for further momentum.
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