- The NZD / USD remains under pressure near a three-week low.
- Fed Powell’s conservative optimistic comments help the US dollar.
- The US-Chinese battles are weighing on commodity currencies.
- A light schedule can keep the key to qualitative catalysts.
The NZD / USD fell to 0.5930 in the middle of the initial time of the Tokyo session on Monday. The pair of kiwis remains on the back foot, the recent comments of the president of the Fed helping the American dollar to gain strength while the American-Chinese tension weighs on the antipodes.
New Zealand’s BusinessNZ Performance of Services (PSI) may also put downward pressure on the pair in April. The numbers drop to 25.9 from 52.00 previously recorded in February. It should be noted that the gauge missed the March readings.
Fed President Jerome Powell reiterated the central bank’s readiness to act and use all weapons during his “60-minute” interview on American television. What was notable, however, was the central bank’s optimistic tone about the prospects for an economic recovery in the United States and the criticism of negative rates.
Read: Fed Powell: Fed Is Not Running Out Of Ammo, Can Do More If Needed – 60 Minute Interview
President Donald Trump has also added his share of keeping the greenback on top. The Republican leader tweeted, “The number of coronavirus cases is trending down sharply in the United States, with a few exceptions. Very good news, indeed! ”
The aforementioned catalysts help the sentiment of market risk tone to remain positive, as shown by the S&P 500 Futures indices, Asian stocks and 10-year US Treasuries.
However, the battle between the U.S. and China is something that worries global market players. US President Donald Trump continues to allege China for the global coronavirus epidemic (COVID-19) and cited a “super-duper missile” to overtake its military rivals, including Russia and China. On the other hand, the Chinese editor of the Global Times called on the dragon nation to develop a nuclear arsenal to possess enough capabilities that the United States would not dare to attack China proactively under any circumstances.
Given the lack of major data / events to publish, traders in the pair will keep their eyes on virus / trade updates for a new direction.
Trade sustained below a six-week old support line, at 0.5995 now, keeps the Kiwi pair on April 23 near 0.5910.