NZD/USD steadies near 0.6470 ahead of US data
- Market sentiment remains positive on Thursday on trade headlines.
- US Dollar Index clings to weekly gains above 98.
- Coming up: Nonfarm Productivity and Unit Labor Costs data from US.
After capitalizing on the upbeat jobs report from New Zealand and climbing above the 0.6500 handle earlier in the week, the NZD/USD pair struggled to continue to push higher amid the broad-based USD strength. However, the upbeat market mood and the latest headline surrounding the US-China trade deal seems to be helping the kiwi stay relatively resilient against the greenback. As of writing, the pair was trading at 0.6470, where it was virtually unchanged on a daily basis.
China has announced that it will reduce tariffs on imported US goods by 50% starting February 14 as part of Phase One of the trade deal. Washington is expected to cut the tariffs on Chinese imports as well.
In the early trading hours of the Asian session on Friday, the Reserve Bank of New Zealand will publish its Inflation Expectations report for the first quarter.
USD stays strong ahead of Friday's NFP data
On the other hand, the US Dollar Index, which received a strong boost from surging US Treasury bond yields in the last couple of days, is clinging to its weekly gains near the 98.30 mark to force the pair to stay stuck in its range. During the American trading hours, Nonfarm Productivity and Unit Labor Costs for the fourth quarter will be looked upon for fresh impetus. Friday's Nonfarm Payrolls (NFP) will be the last significant data release of the week.
Previewing the NFP data, "job growth likely improved in January, coming in at a more trendlike 170K gain after employers added 145K jobs in December," said Wells Fargo analysts. "Jobless claims have settled down in recent weeks, while sub-indices of regional purchasing managers’ surveys indicate hiring firming. The kick-off of the Census year may give payrolls an additional small lift.”
Technical levels to watch for