NZD/USD continues to recover Monday's losses, trades around 0.6430
- Renewed US-China trade optimism helps antipodeans find demand.
- AUD gathers strength after RBA maintains status quo.
- Economic activity in China's services sector expanded at a softer pace than expected.
The NZD/USD pair erased 30 pips on Monday but gained traction during the Asian trading hours on Tuesday and started to recover its losses. As of writing, the pair was trading at 0.6428, adding 0.42% on a daily basis.
The ANZ Commodity Price Index came in at +1.2% in October in New Zealand to beat the market expectation of 0.2% and provided a boost to the NZD on Tuesday. Additionally, the Reserve Bank of Australia (RBA) announced that it kept its policy rate unchanged at 0.75% and refrained from hinting at a rate cut in December and allowed the AUD/USD pair to push higher, supporting the positively-correlated NZD/USD pair as well.
Meanwhile, comments from officials from both sides at the start of the week suggested that the United States and China are moving closer to completing the phase-one of the trade deal and helped antipodeans outperform their major rivals.
USD stays quiet ahead of mid-tier data
In the second half of the day, the IBD/TIPP Economic Optimism Index, the ISM Non-Manufacturing Purchasing Managers' Index (PMI) from the US will be featured in the economic calendar. Ahead of these data releases, the US Dollar Index is consolidating Monday's gains near mid-97s. Furthermore, the bi-weekly Global Dairy Trade (GDT) auction in New Zealand will be looked upon for fresh impetus.
Technical levels to watch for