NZD/USD steps back from six-week high on downbeat China PMIs
- NZD/USD drops after China PMIs, official and Caixin both, flashed weak figures.
- Mixed data from ANZ, US President Trump’s trade rhetoric exert additional downside pressure.
- Risk-tone struggles for direction after the virus drug development favored trade sentiment the previous day.
NZD/USD extends pullback moves from multi-day high to 0.6120, down 0.25% on a day, after China’s Manufacturing PMIs eased in April. Also exerting downside pressure on the Kiwi pair are the mixed figures from the Australia and New Zealand Banking Group (ANZ) concerning the New Zealand (NZ) economy and comments from US President Donald Trump.
After the official Manufacturing PMI slipped beneath 51.00 market consensus to 50.80, Caixin Manufacturing PMI also weakened below 50.1 prior to revisit the activity contraction suggesting area with 49.8 figures.
On the other hand, the ANZ Business Confidence for New Zealand, for April, recovered from -69.5 expected to -66.6 but Activity Outlook dropped below -26.7% previous mark to -55.1%.
Other than the mixed data, US President Trump’s comments that US trade deal with China has been “upset very badly” by the coronavirus also weighed on the market’s risk-tone and antipodeans.
It should be noted that upbeat news concerning the drug development and US President Trump’s push for the economy’s re-start helped the risk-takers earlier.
Amid all these, US Treasuries struggle to extend the previous recoveries whereas the US stock futures also trim the early-day gains.
Looking forward, the US Weekly Jobless Claims and the ECB meeting become the key catalysts on the economic calendar whereas virus/trade updates will also be important to follow.
Technical analysis
Unless the Kiwi pair drops below the 50-day SMA level of 0.6060 on a daily closing basis, it continues to aim for the yearly resistance line near 0.6210.