NZD/USD trades at fresh two-week lows above 0.6350 ahead of NFP
- US Dollar Index plummets below 97 on Friday.
- 10-year US T-bond yield slumps to fresh record lows to weigh on USD.
- Nonfarm Payrolls in US is expected to come in at +175K in February.
The NZD/USD pair extended its rally into a fifth straight day on Friday and touched its highest level in two weeks at 0.6373. As of writing, the pair was up 0.95% on the day at 0.6362.
DXY falls to the lowest level since March 2019
The heavy selling pressure surrounding the USD continues to dominate the FX market's action ahead of the weekend. Heightened fears over the coronavirus outbreak having a long-lasting impact on the global economy force investors to seek refuge.
With the 10-year US Treasury bond yield erasing more than 15% and renewing its all-time low below the 0.7% mark on Friday, the US Dollar Index (DXY) dropped below the 96 handle to provide a boost to the pair. At the moment, the DXY is at its lowest level in nearly a year at 95.80, losing 0.83% on a daily basis.
During the early trading hours of the American session, the US Bureau of Labor Statistics will release the Nonfarm Payrolls data for February. Trade Balance figures will also be featured in the US economic docket.
Previewing the data, “payrolls probably slowed significantly after a mild-weather-assisted surge in January," said TD Securities analysts. "The weather was milder than usual in February as well, but not to the same degree as in January. Our 170K forecast allows for a 7K boost from temporary hiring for the 2020 census, consistent with weekly data released by the Census Bureau.”
US NFP Preview: 6 Major Banks expectations for February payrolls report.
Technical levels to watch for