- The NZD / USD loses its bullish momentum after rising to 0.6430.
- On Wednesday, risk flows continue to dominate the financial markets.
- The US dollar index remains close to 97.50 before the US data.
The NZD / USD pair rose for the third day in a row on Wednesday as the kiwi continued to find demand in the risky market environment. In addition, Chinese optimistic data has given the pair an extra boost during Asian trading hours.
After reaching its highest level since early March at 0.6431, the NZD / USD entered a consolidation phase and was last seen at 0.6390, still gaining 0.33% on the day.
Earlier today, data from China showed that business activity in the Chinese service sector expanded at a brisk pace in May, with the Caixin PMI falling to 44 from 44.4 in April. At the same time, reflecting the optimistic mood in the market, the main European stock market indices are recording solid gains.
DXY moves away from lows before key data releases
In contrast, the US dollar index (DXY), which fell to a new low of several months at 97.30 on Wednesday, rallied slightly to 97.50 zone ahead of US data and caused the removal of the pair from its tops.
During the US session, ADP Employment Change and ISM Non-Manufacturing PMI data will be included in the US economic record.
Previewing ADP data, “private payrolls administered by automatic data processing (ADP) are expected to lay off 9 million workers in May after losing 20 million workers in April,” FXStreet analyst Joseph Trevisani noted. “Unless the ADP figures are considerably better than expected, reinforcing the scenario of economic recovery, they will have a marginal commercial impact. The catastrophe is already old news.”