NZD/USD clings to modest daily gains around 0.7030
- NZD/USD stages modest rebound following Wednesday's drop.
- US Dollar Index stays relatively quiet below 92.50.
- Focus shifts to mid-tier US data, FOMC Chairman Powell's speech.
The NZD/USD pair edged slightly lower during the Asian trading hours but managed to reverse its direction in the European session. As of writing, the pair was up 0.3% on a daily basis at 0.7032.
Earlier in the day, the data from New Zealand showed that the ANZ Business Confidence Index in April dropped to -8.4 and missed the market expectation of -6.5. Furthermore, the ANZ Activity Outlook Index inched lower to 16.4% from 16.6% in March and made it difficult for NZD to gather strength.
DXY struggles to build on Wednesday's gains
Nevertheless, the USD's market valuation remains the primary driver of NZD/USD's movements. With the 10-year US Treasury bond yield losing more than 1% on Thursday, the US Dollar Index (DXY) is posting small losses at 92.37 and support NZD/USD's rebound.
Later in the session, the weekly Initial Jobless Claims report will be featured in the US Economic docket. More importantly, FOMC Chairman Jerome Powell will be delivering a speech at 1600 GMT. The FOMC's March meeting minutes offered no surprises with regards to the near-term policy outlook on Wednesday.
Assessing the publication, "the minutes were, on the whole, as dovish as expected, noting that labour market conditions for "those in the most disadvantaged communities were viewed as lagging" and, as a result, "the economy was far from achieving the FOMC's broad-based and inclusive goal of maximum employment"," noted Capital Economics analysts.
Technical levels to watch for