NZD/USD Holding Sub 0.5900, Services PMI Joins Manufacturing In Contraction Territory

NZD/USD was close to flat in Friday trade. The pair spending most the session in a tight 0.5880/0.5900 range. In early Monday trade we track near 0.5890. The Kiwi, along with AUD and JPY, underperformed in Friday's session, with other majors recording modest gains against the USD (most notably NOK, +0.97%).

• Current spot levels remain close to the 20-day EMA (near 0.5900), the rest sit above spot levels, with the 100-day (0.5984), likely a key resistance point. On the downside, focus likely remains on recent lows sub 0.5800.
• Cross asset signals saw a strong rise in US equities on Friday (SPX +1.56%), while US yields mostly stayed on the front foot. NZ-US 2yr swap spreads sit back at March lows, last near +36bps, moves in the spread have tracked NZD shifts well in recent weeks. US yields spent much of last week recouping lost ground from the NFP print.
• Commodity indices were mostly weaker on Friday, offsetting some of the equity rebound in terms of risk appetite (-0.43% for the Bloomberg aggregate index). We fell every session last week, amid fresh global demand concerns.
• On the data front, we have already had the performance of services index print for October. It fell to 48.9, from 50.6 prior. Recall the manufacturing PMI on Friday fell to 42.5 from 45.1.
• The data calendar for the rest of this week is mostly second tier.