NZD/USD slides closer to multi-month lows, 0.68 handle back on sight
• Firming Fed rate hike expectations prompt fresh selling.
• Weaker ANZ consumer confidence data adds to the downward pressure.
• US tax legislation headlines to holds dominant position.
After yesterday's brief pause, the NZD/USD pair came under some renewed selling pressure on Thursday and inched back closer to multi-month lows.
The pair extended overnight sharp pull-back from levels beyond the 0.6900 handle and has now retreated over 130-pips from the 0.70 neighborhood, touched last week. The pair held in bearish territory for the fifth session, in the previous six, and was being further weighed down by worse-than-expected ANZ consumer confidence index for Nov.
Meanwhile, Wednesday's US economic data, showing an uptick in the underlying inflation, helped partially offset the ongoing concerns over the US tax reform bill and reaffirmed December Fed rate hike expectations. Thus, a modest pickup in the US Treasury bond yields was seen lending some support to the US Dollar and was eventually weighing on higher-yielding currencies - like the Kiwi.
Today's US economic docket, featuring the release of usual weekly jobless claims and industrial production data, is likely to be overshadowed by any fresh news headlines over the long-awaited US tax legislation.
Technical levels to watch
Immediate support is pegged near 0.6830 level, below which the pair is likely to aim towards testing the 0.6800 handle before eventually dropping to 0.6770 support.
On the upside, momentum back above 0.6870 level might continue to confront fresh supply near the 0.6900 handle, which if cleared might trigger a short-covering bounce.