NZD/USD erases early gains, trades in red near 0.6830

• Chinese economy expanded by 6% (YoY) in Q4 as expected.
• Business NZ PMI slumped to 49.3 in December from 51.2.
• Coming up: Industrial Production and UoM Consumer Confidence data from US.

The NZD/USD pair registered modest gains during the Asian trading hours but struggled to push higher and changed its direction with the greenback gathering strength during the European session. As of writing, the pair was down 0.12% on the day at 0.6630.

The data from China on Friday revealed that the Chinese economy expanded by 6% on a yearly basis in the fourth quarter to match analysts' estimates. Other data showed that Industrial Production and Retail Sales in China rose 6.9% and 8% in 2019 with both readings coming in higher than the market expectations.

Despite the upbeat data from China, the disappointing Business NZ PMI data from New Zealand, which slumped to 49.3 in December from 51.2 in November, kept the NZD's gains in check.

USD gathers strength ahead of US data dump

The dismal performance of the EUR and the GBP in the second half of the day allowed the USD to find demand and weigh on the NZD/USD pair. As of writing, the US Dollar Index is up 0.13% on the day at 97.43. The US economic docket on Friday will feature Industrial Production, UoM Consumer Confidence Index, Building Permits and Housing Starts data. FOMC member Harker, Quarles and Bowman are scheduled to deliver speeches later in the day as well.

Technical levels to watch for