NZD/USD hovers around 0.6000 ahead of US NFP data

• NZD/USD drifts lower to 0.6012 on the stronger USD on Friday. 
• US Initial Jobless Claims last week jumped to 221K compared to 212K prior, the highest since January.
• The RBNZ is expected to keep interest rates on hold at its policy meeting next week.

The NZD/USD pair trades on a softer note near 0.6012 on Friday amid the firmer US Dollar (USD). The markets turn to a cautious mood ahead of the key US labor market data, including Nonfarm Payrolls (NFP), Unemployment Rate, and Average Hourly Earnings for March.

The Labor Department reported on Thursday that the weekly Initial Jobless Claims last week went up to the highest level since January. The number of Americans filing new claims for unemployment benefits jumped to 221K for the week ended March 30 compared to 212K prior, below the consensus of 214K. Additionally, the Continuing Claims decreased to 1.791M in the week ended March 23.

Investors will shift their focus to the highly-anticipated Nonfarm Payrolls (NFP), due on Friday. The NFP figure is projected to show that the US economy added 200K jobs in March from 275K rise in February. Meanwhile, the Unemployment Rate is forecast to remain steady at 3.9% in March. If the US NFP data portrays a stronger-than-expected result, this might temper June Fed rate-cutting expectations, offering some support to the Greenback and dragging the NZD/USD pair lower. According to the CME FedWatch Tool, financial markets are now pricing in nearly 65% odds that the Fed will lower its interest rate in June, up from 60% in the previous week. 

On Thursday, the New Zealand Building Permits improved to 14.9% MoM in February from an 8.6% decline in the previous reading, Statistics New Zealand showed. The Reserve Bank of New Zealand (RBNZ) is expected to keep interest rates on hold at its policy meeting next week. The central bank noted that it needs to keep policy restrictive to ensure that inflation expectations become fully anchored. However, investors will take more cues from the policy statement, the dovish tweaks to the outlook might drag the New Zealand Dollar (NZD) and create a headwind for the pair.