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NZD / USD tests one-week highs, above 0.6950

  • The NZD / USD is advancing for the third day in a row and is once again nearing the one-week highs.
  • A generally positive risk tone was seen as a key factor benefiting the kiwi.

The NZD / USD pair rose further throughout the first half of the European session and reached new daily highs at 0.6963. It remains near the highs with the bullish tone.

The pair rose for the third day in a row on Wednesday and returned to close to the week-long highs touched in the previous session. A generally positive risk tone was seen as a key factor that extended some support for the kiwi. That said, a modest strength in the US dollar could keep a check on any further gains for the NZD / USD.

Concerns about the fast-spreading delta variant abated after China said it had halted the community spread of COVID-19. In addition to this, the United States Food and Drug Administration (FDA) granted full approval to the Pfizer / BioNTech COVID-19 vaccine. This raised expectations of an acceleration of vaccination in the United States.

On the other hand, some rallies in US Treasury yields helped the dollar to move away from the one-week lows hit in the previous session. In fact, the benchmark 10-year US government bond yield rose back to the 1.30% threshold amid expectations that the Federal Reserve could begin to reverse its stimuli in 2021. This will be key to the speech of the president of the Fed, Jerome Powell, at the Jackson Hole Symposium later this week. The US durable goods orders report will be released on Wednesday.

Technical levels

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