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NZD/USD hits 2-week highs after NFP but then retreats

FXStreet (Córdoba) - NZD/USD jumped initially after the US employment report but then pulled back erasing part of the gains. Disappointing numbers from the labor market boosted the pair to from 0.6400 to 0.6454, hitting the highest level in two weeks. But the greenback recovered ground against commodity and emerging market currencies amid risk aversion. NZD/USD retreated but remained above 0.6400.

Currently the pair trades at 0.6415/20, slightly above the level it had before NFP. To the upside, the pair continues to face resistance around 0.6450 where yesterday’s highs area located. Above, NZD/USD could gain further bullish momentum. On the opposite direction, a retreat that pushes the pair below 0.6400 could signal a possible reversal.

US nonfarm payrolls to delay liftoff

According to the US Labor Department, the economy added 142,000 new jobs in September, considerable below expectations of an increase of 203,000. August and July gains were revised lower from 173,000 to 136,000 and 245,000 to 223,000 respectively.

“There is nothing good that can be said about the US jobs data. It was simply dreadful. Every metric disappointed, and the August series which so often is revised higher, came in lower. This will raise fresh doubts about the US economy and the ability of the Federal Reserve to raise rates, not just this month, but this year”, wrote analysts from Brown Brothers Harriman.

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