The markets are now waiting for the NFP report.
NZD/USD is trading towards the lows after another bid in the greenback.
NZD/USD is down 0.2 percent in early Asian trading on Friday, as traders await the release of US Nonfarm Payrolls in the US session.
NZD/USD is currently trading at 0.6966, near the day’s lows of 0.6961, following a dip from the 0.7010 highs fueled by the US dollar’s rise.
The previous day’s better-than-expected ADP employment report was viewed as a good precursor to Friday’s US payroll data, sending the greenback to new cycle highs.
The US dollar index, which compares the dollar to six major currencies, climbed to 92.6021, its highest level since early April. It was last trading at 92.542, up 0.2 percent.
The index had its best month since November 2016, thanks in part to the Federal Open Market Committee’s surprising hawkish tilt during a meeting that took place during the month.
Two interest rate hikes are expected by the end of 2023, according to member predictions provided after the June FOMC meeting.
Month-end and quarter-end rebalancing have also generated some much-needed volatility in forex, albeit the New Zealand dollar and the Australian dollar have been more steady than the majors.
“Price action remains odd (at least in our opinion), with the NZD unable to benefit from decreasing US bond rates, raising expectations for earlier OCR hikes here, and the ongoing rally in commodity prices,” according to ANZ Bank analysts.
“We believe that provides a favorable backdrop for the NZD to rise, but it has been an unusual week, and patience may be necessary.”
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