NZD/USD rises above 0.5750 as China’s retail sales increase year old in January-February

• The NZD/USD is strengthened after the publication of China’s key economic data on Monday.
• China’s retail sales grew by 4.0% year-on-year in January-February, improving with respect to the 3.7% increase in December.
• The US dollar remains under pressure since Michigan’s feeling index decreased in March.

The NZD/USD continues its bullish impulse for the second consecutive day, quoting around 0.5760 during Monday’s Asian hours. The torque is strengthened after the publication of China’s economic data, with retail sales by increasing 4.0% year-on-year in January-February, compared to the growth of 3.7% of December.

In addition, industrial production expanded 5.9% year -on -year, exceeding 5.3% but slightly below the previous reading of 6.2%. China’s positive economic indicators tend to support the NZD, given China’s role as a key trade partner for New Zealand.

After the publication of the High Impact Activity Data in China, the National Statistics Office (NBS) shared its economic perspective during a press conference on Monday. Although the resilience of the economy highlighted, the NBS stressed the growing external challenges and a more complex global environment.

In addition, the New Zealand dollar (NZD) gained support after China introduced a special action plan during the weekend to stimulate consumption. The initiative includes salary increases, measures to boost household spending and efforts to stabilize shares and real estate markets, improving the general feeling of the market in the region.

In the domestic front, the New Zealand Business Nz Services Performance Index (PSI) decreased to 49.1 in February from 50.4 in January, indicating a return to contraction in the service sector.

The NZD/USD also advanced as the US dollar (USD) weakened before the next publication of US retail sales data in the US session. The dollar faced pressure after the University of Michigan (UOM) reported a drop in its feeling index of the preliminary consumer for March on Friday, falling to 57.9 – its lowest level since November 2022 – from 64.7 previously. This figure was also below the estimate of the 63.1 consensus.