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NZD/USD Edges Lower On Soft US Data, Building Permits Shortly

NZD

The NZD/USD was steady heading into the US session on Monday, before selling off about 30-pips on the back of softer US data would pushed the USD higher, the pair ended the session down 0.26% at 0.6076, while the BBDXY finished the session up 0.12% at 1,271.06.

  • Soft US data which showed ISM mfg and prices paid miss, while MFG PMI was revised down fractionally in the final June release to leave a still modest increase to 51.6 (cons & prelim 51.7) after 51.3 in May.
  • Analysts at UOB Group suggest the NZD/USD is likely to trade in a sideways range of 0.6080/0.6120, with room for further NZD weakness.
  • Immediate support is seen at 0.6058 (June 28 lows), with a break potentially targeting 0.6038 (Feb 5 lows). Resistance is at 0.6111 (20-day EMA), with a breach opening a move towards 0.6148 (June 20 High).
  • The US-NZ 2yr swap is down 5bps to -28bps.
  • Expiries: No large nearby strikes on Monday, with notable upcoming strikes at 0.6130 (NZD720.7m on July 4) and 0.6250 (NZD436.8m on July 5).
  • Looking ahead, Building Permits data at 8:45 AEST.

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