- US Existing Home Sales fall -2.2% in July, citing “stock availability” and rising “mortgage rates” as reasons.
- The Richmond Fed’s manufacturing index meets expectations with a -7 drop, while the services index surprises positively.
- US bond yields show mixed dynamics, but the dollar continues its rise with the DXY at 103.588.
The pair NZD/USD recovers some ground although it is away from the highs of the day of 0.5972, trading at 0.5941, amid a mixed market environment stimulated by fears about recent events in China and uncertainty about the outcome of the Fed Chairman’s speech US Federal Jerome Powell in Jackson Hole.
Kiwi recovers slightly but remains under pressure on China concerns and US economic data
US stocks pull back as market sentiment remains fragile. The National Association of Realtors (NAR) revealed that Existing Home Sales fell -22% in July, but improved compared to June’s figures, which were -3.3%. According to the report, “inventory availability” and rising “mortgage rates” are the factors driving the drop in the latest report, NAR chief economist Lawrence Yun revealed.
In other data released by the Richmond Fed, the manufacturing index plunged -7 as expected in August, although the services index beat estimates for a -4 contraction to 4.
US bond yields are mixed, as the short leg of the curve continues to decline, while the 10, 20 and 30 legs fall between 0.18% and 0.47%. However, the dollar continues to rise, and the Dollar Index (DXY), which measures the value of the dollar against six currencies, advanced 0.26% to 103.588.
Meanwhile, Richmond Fed Chairman Thomas Barkin stressed that hitting the 2% target is crucial to the Fed’s credibility. Later in the day, moreover, Fed policymakers will cross the wires, with Bowman and Golsbee below.
In New Zealand (NZ), the lack of economic data has traders keeping an eye on the latest developments in China and market sentiment. However, retail sales for the second quarter are due to be released on Wednesday and are expected to exceed previous quarterly figures, while quarter-on-quarter developments are expected to disappoint investors. Therefore, an advance of the NZD/USD could be expected.
In the US, the economic agenda will include the presence of the Fed, the S&P Global PMIs, durable goods orders and new home sales.
NZD/USD Price Analysis: Technical Perspective
NZDUSD remains biased to the downside despite rebounding from year-to-date lows of 0.5896. If NZD/USD buyers want to turn the trend back to neutral, they need to recapture the May 31 daily low turned resistance at 0.5985, followed by the June 8 daily low at 0.6031. However, the NZD/USD path of least resistance is to the downside, and it could test the Nov 10 daily low at 0.5840, followed by the Nov 3 swing low at 0.5741.
NZD/USD Daily Chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
