NZD Falls on Weak China Data and Stronger US Dollar

Fundamental Analysis

* Weak Kiwi: The New Zealand Dollar continues to weaken against the U.S. Dollar, pressured by deflation concerns in China, its largest trading partner. Uncertainty over Beijing’s economic stimulus efforts has raised concerns about future demand. China’s National Bureau of Statistics reported on Sunday that the country’s Consumer Price Index (CPI) was flat at 0% in September, following a 0.4% increase in August. Yearly inflation rose by 0.4%, missing the forecasted 0.6%. Additionally, the Kiwi is being weighed down by U.S. dollar strength, driven by growing expectations that the Federal Reserve will slow rate cuts more than expected.

Technical Analysis

* Technical Breakout: : NZDUSD was traded lower following prior retracement from the resistance level 0.61000. MACD which illustrate diminishing bullish momentum signal suggest the pair to likely extend its losses further.

* Resistance and Support: If the bearish momentum persists, there’s a strong likelihood that the price will potentially head towards the level 0.59850. Conversely, a potential reversal is also to be expected and the price could head back towards 0.61850 after it breach above the level 0.61000.

Potential Risks

Looking ahead, investors will be closely monitoring key U.S. data releases, particularly Retail Sales, which could provide further insights into the economic outlook. In addition, attention will remain on the economic developments in New Zealand’s key trading partners, China and Australia, as shifts in their economic performance could influence the Kiwi’s movement.

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Monitoring

SStay updated on US and China data, central bank updates and any shifts in the US Dollar’s strength by following PU Xtrader’s financial news page.

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