NZD/USD treads waters above 0.5950, US economic data eyed

• NZD/USD consolidates ahead of the release of US economic data.
• US Treasury yields extend its losses; reinforcing weakness in the US Dollar (USD).
• Investors await US PCE, seeking fresh impetus on the Fed’s policy decision.

NZD/USD struggles to snap the previous day’s losses, treading waters around 0.5960 during the early trading hours in the European session on Thursday. The pair is experiencing downward pressure due to a modest recovery in the US Dollar (USD) ahead of the economic data release from the United States (US).

However, the NZD/USD gained profits earlier during the day amid China’s moderate economic data released on Thursday. The August NBS Manufacturing PMI indicated a slight improvement in business conditions, reporting a reading of 49.7 against the expected 49.24 figure and 49.3 prior. While, Non-Manufacturing PMI declined to 51.0, worse than the market consensus of 51.1 figure. The index reported a reading of 51.5 in July.

US Dollar Index (DXY), which measures the performance of the US Dollar (USD) against the six other major currencies, snaps a three-day losing streak. Spot price is beating around 103.30 at the time of writing. The Greenback experienced downward pressure, which is attributed to the slew of downbeat economic data from the US along with declining US Treasury yields. The yield on 10-year US bond trades at 4.10%, continuing downward trajectory for the fourth consecutive day.

As mentioned, the US ADP National Employment report showed 177K jobs added to the economy in August compared to the anticipated 195K jobs. This was a sharp contrast to the 371K jobs that were generated in July. Moreover, the preliminary Gross Domestic Product (GDP) report printed the figure of 2.1%, falling short of the prior reading of 2.4%.

Investors will likely monitor the upcoming data from the US scheduled to be released on Thursday, seeking further cues on economic situations in both countries. These datasets include the Personal Consumption Expenditures (PCE), and further Initial Jobless Claims (Aug 25). On the other hand, New Zealand’s leading index ANZ – Roy Morgan Consumer Confidence (Aug) will be released on Friday, which measures the level of consumer confidence in economic activity.