NZD/USD finds resistance near 0.66, retreats to 0.6580 on modest USD recovery
- US Dollar Index retraces small portion of daily fall in the early American session.
- New Zealand GDP expands by 0.6% in the first quarter as expected.
- Weekly jobless claims in the U.S. comes in slightly better than the market estimate.
The NZD/USD pair took advantage of the broad-based selling pressure surrounding the dollar following the FOMC's dovish shift yesterday and advanced to its highest level in 9 days at 0.6597 before staging a technical correction in the last hour. As of writing, the pair was up 0.66% on a daily basis at 0.6581.
The Fed removed the term "patient" from its policy statement when talking about possible future policy adjustments and triggered a USD selloff. After this event, “We continue to expect a 25bps FFTR cut in July; we believe it would take a definitively positive G20 outcome and an improvement in the data for the FOMC not to cut next month," Standard Chartered analysts argued. "A 50bps cut is also on the table in case of a poor G20 outcome or a pronounced economic deterioration.”
The US Dollar Index, which fell to its lowest level in two weeks at 96.57, was last seen at 96.67, where it was down 0.57% on the day. The weekly data from the U:S. revealed that the initial jobless claims fell to 216,000 in the week ending June 14 but didn't have a notable impact on the greenback's valuation.
On the other hand, the data published by the Statistics New Zealand during the Asian trading hours revealed that the real Gross Domestic Product expanded by 0.6% on a quarterly basis in the first quarter to match analysts' estimates and kept the annual growth rate steady at 2.5%.
Technical levels to consider
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