NZD/USD rebounds modestly toward 0.7200 ahead of key US data
- NZD/USD edges higher ahead of the American session.
- US Dollar Index holds above 90.00 on Thursday.
- Focus shifts to CPI and Jobless Claims data from US.
The NZD/USD pair closed the previous two trading days in the negative territory and dropped to a fresh six-day low of 0.7165 on Thursday. With the greenback struggling to preserve its strength during the European trading hours, the pair staged a modest rebound and was last seen gaining 0.08% on the day at 0.7185.
Eyes on US inflation report
In the absence of significant fundamental drivers, the positive shift witnessed in market sentiment seems to be making it difficult for the USD to find demand. The US Dollar Index, which advanced to a daily high of 90.28, is currently flat on the day at 90.16.
Later in the session, the US Bureau of Labor Statistics will release May Consumer Price Index (CPI) data.
Previewing the inflation report, "strength in travel items, most notably used vehicles, airfares and lodging, likely led to another strong rise in core prices, albeit not quite as strong as in April. We advise against extrapolating, but the data will keep alive the "transitory" debate," said TD Securities analysts. "The boost from base effects will peak with this report; we forecast 4.8%/3.6% YoY for total/core prices, up from 4.2%/3.0%."
US CPI Preview: Forecasts from eight major banks for critical May inflation.
The US Department of Labor's weekly Initial Jobless Claims data will be featured in the US economic docket as well.
Technical levels to watch for