News & Analyses

NZD/USD moves below 0.6000 after the release of Business NZ PMI

  • NZD/USD retreated after the data showed the manufacturing sector had been in contraction for 14 consecutive months.
  • The Business NZ Performance of Manufacturing Index improved to 48.9 from March’s 46.8, yet remained below February’s level of 49.1.
  • The lower US Treasury yields may put pressure on the US Dollar.

NZD/USD has halted its two days of gains, trading around 0.6020 during the Asian session on Friday. The New Zealand Dollar (NZD) received pressure after the release of the Business NZ Performance of Manufacturing Index (PMI), gauging business activity in New Zealand’s manufacturing sector.

However, the data indicated an improvement in April, with the seasonally-adjusted figure reaching 48.9 compared to March’s 46.8, although still below February’s 49.1. Despite the manufacturing sector being in contraction for 14 consecutive months, there are signs of improvement.

On Saturday, Chinese Consumer Price Index (CPI) data is anticipated to show a 0.1% increase for April, which could influence New Zealand’s market due to the close trading ties between the two nations.

The US Dollar Index (DXY), which gauges the performance of the US Dollar (USD) against six major currencies, attempts to rebound due to the sentiment of the Federal Reserve (Fed) maintaining higher interest rates for longer. However, the Greenback faced a challenge due to the lower US Treasury yields, which could be attributed to the weak US Initial Jobless Claims released on Thursday.

The US Bureau of Labor Statistics (BLS) released data indicating that the number of individuals filing for unemployment benefits exceeded expectations. Initial Jobless Claims for the week ending May 3 rose to 231,000, surpassing estimates of 210,000 and showing an increase from the previous week’s reading of 209,000.

Ahead of the day, the preliminary Michigan Consumer Sentiment Index for May is due, with expectations for a slight decrease. This index is a survey that measures sentiment among US consumers, covering three main areas: personal finances, business conditions, and buying conditions.


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