NZD/USD trades sideways above the 0.5960 mark, investors focus on US NFP
- NZD/USD struggles to find direction ahead of the key US data.
- US PCE inflation matches expectations; Initial Jobless Claims are lower than expected.
- New Zealand’s consumer confidence rose to 85 in August from 83.7.
- Investors will monitor the US ISM Manufacturing PMI, Nonfarm Payrolls, Unemployment Rate.
The NZD/USD pair trades sideways below the 0.6000 barrier during the early Asian session on Friday. The US Dollar Index posts mixed results following the US economic data. The pair currently trades near 0.5965, down 0.02% on the day. Market participants await the highly anticipated US Nonfarm Payrolls due later in the American session. The figure is expected to show a 170K rise in jobs.
On Thursday, the Federal Reserve’s preferred gauge of inflation, the US Core Personal Consumption Expenditure Price Index, rose to 4.2% in July from 4.1% prior, in line with expectations. Additionally, Initial Claims fell to 228,000, falling short of the forecast 232,000 and marking the lowest number in four weeks. Continuing Claims, on the other hand, reached their highest level in six weeks.
On the Kiwi front, the ANZ – Roy Morgan Consumer Confidence for August showed that consumer confidence in New Zealand improved marginally to 85 in August from 83.7 but remained at subdued levels. However, there was more optimism among consumers regarding whether it was a good time to buy household items.
Apart from the data, the chief economist of the Reserve Bank of New Zealand (RBNZ) stated last week that policymakers would cut the OCR earlier than signaled if China experienced a more significant slowdown than the RBNZ anticipates. Investors will keep an eye on the Chinese Caixin Manufacturing PMI due later in the day. The weaker-than-expected result might exert pressure on the China-proxy Kiwi and act as a headwind for the NZD/USD pair.
Moving on, market players will closely watch the US ISM Manufacturing PMI. The figure is expected to improve from 46.4 to 47. The attention will then shift to Nonfarm Payrolls (NFP), followed by the Unemployment Rate. Traders will take cues from the data and find trading opportunities around the NZD/USD pair.