- The NZD / USD rose for the second consecutive session on Thursday.
- The softer risk tone benefited the dollar as a safe haven and limited the rise.
- Investors are now looking to Trump-Biden for a significant boost.
The pair NZD / USD it traded with a slight positive bias during the mid-European session and was last seen trading near the upper end of its daily range, around the 0.6665-70 region.
After an initial drop towards 0.6630, the pair turned positive for the second session in a row on Thursday and may now be looking to build on the strong overnight move of more than 100 pips. The rally lacked an obvious fundamental catalyst and lacked a strong following amid resurgent demand for the US dollar.
The latest optimism about the next round of the US fiscal package faded rather quickly amid slow progress in stimulus talks and investors’ appetite for risk waned. This was evident from a weaker tone around equity markets, which benefited the safe-haven dollar and limited gains for the perceived riskier kiwi.
Negotiations between the Speaker of the House of Representatives, Nancy Pelosi, and the Secretary of the Treasury, Steven Mnuchin, will continue this Thursday. However, prospects for any substantial aid to be passed before the US presidential election remain dim amid strong opposition from Senate Republicans over the size of the stimulus bill.
In addition to developments related to US tax aid, investors on Thursday will also focus on the final presidential debate between President Trump and his Democratic rival Joe Biden. In the meantime, release of US initial weekly unemployment claims data for some short-term business opportunities will be considered.
Technical levels
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Credits: Forex Street
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