NZD/USD stays in weekly range above 0.64 handle
- China suspends tariffs on some US imports on Wednesday.
- Broad USD strength doesn't allow the pair to climb higher.
- Annual core PPI in US is expected to rise to 2.2% in August.
Since closing the previous week above the 0.64 handle, the NZD/USD pair has been having a difficult time finding direction despite the positive developments surrounding the US-China trade dispute and has been moving in a tight range above. As of writing, the pair was trading at 0.6417, losing 0.1% on a daily basis.
NZD ignores China's suspension of tariffs on some US imports
China's Finance Ministry today announced that it will exempt 16 types of US imports from the retaliatory import tariffs to raise hopes of sides making progress in next months high-level US-China trade talks in Washington. Nevertheless, the trade-sensitive NZD/USD pair struggled to capitalize on this development as the broad-based USD strength offset any potential gains in the NZD's market valuation.
Ahead of today's Producer Price Index (PPI) and tomorrow's Consumer Price Index (CPI) data from the United States, the US Dollar Index is adding 0.3% on the day at 98.62.
Previewing today's PPI data, “The PPI got a bump in July due to higher energy costs, but lower gas prices suggest only a 0.1% gain in August," said Wells Fargo analysts.
"That should keep the year-over-year change in producer prices below 2% and signal inflation is still not a threat to the Fed’s easier policy stance of late.”
On the other hand, the next significant macroeconomic data release from New Zealand will be the Business NZ PMI on Friday, which showed a contraction in the economic activity in July by coming in below 50.
Technical levels to watch for