NZD/USD challenges the 0.6000 area. All eyes are on the FOMC Minutes, China’s economic woes

• NZD/USD holds a positive note around 0.5980, up 0.11% on the day.
• The Reserve Bank of New Zealand (RBNZ) maintained interest rates unchanged at 5.5%, as expected.
• US Retail Sales came in above expectations.
• Investors will monitor the FOMC Minutes on Thursday.

The NZD/USD pair gains momentum and edges higher to 0.5980 heading into the early European session on Wednesday. The pair bounces off the yearly low of 0.5930 following the Reserve Bank of New Zealand (RBNZ) monetary policy meeting earlier in the day.

Earlier on Wednesday, the Reserve Bank of New Zealand (RBNZ) kept the benchmark interest rates unchanged at 5.5%, as expected. RBNZ Governor Adrian Orr also offered a hawkish signal to rein in rising inflation expectations.

Nevertheless, investors still worry about China's deteriorating economic outlook. The latest data on Wednesday revealed that the Chinese House Price Index for July fell to -0.1% versus 0% prior. The data raises concerns about a possible property crisis in China, particularly as big developer Country Garden Holdings struggles to meet its debt obligations. That said, the downbeat Chinese data might cap the upside of China-proxy Kiwi for the time being.

Across the pond, US Retail Sales came in above expectations. The headline figure climbed by 0.7% MoM, higher than the 0.4% estimated. Sales excluding the automobile sector came in at 1%, versus the expected 0.4%. Meanwhile, the NY Empire Manufacturing Index fell to -19 from -1. That said, stronger US data might convince the Federal Reserve (Fed) to hike additional rate by the end of the year. This, in turn, could boost the Greenback and act as a headwind for the NZD/USD pair.

Later in the day, the US Building Permits, Housing Starts, and Industrial Production will be released in the American trading hours. Market players will also take cues from RBNZ Governor Adrian Orr Speaks on Thursday. However, the FOMC minutes will be the key event this week and could give a clear direction to the NZD/USD pair.