Nzdusd drops as u.s. economic data shows mixed signals

NZDUSD Analysis

Performance after Thursday
Period	Pct	Chg	Momentum
Thursday	-0.43%	-25.1 Pips
Week to-date	-0.52%	-31 Pips
May	-1%	-59.6 Pips

Upcoming key events (London Time)

Fri 04:00 AM NZD RBNZ Survey of Inflation Expectations (3-mth)

What happened lately

The U.S. economy presented mixed signals in recent reports. In April 2025, industrial production maintained its level without further decline, remaining at 0% following a previous decrease of -0.3% in March. The retail trade sector, however, showed signs of slowing down with the Retail Trade Control Group declining from a 0.5% increase to -0.2%. Additionally, the New York Empire State Manufacturing Index exhibited further deterioration, dropping from -8.1 points to -9.2 points in May 2025, suggesting continued weakness in manufacturing output.

Producer Price Index (PPI) figures showed a decline, with the overall PPI falling to 2.4% in April 2025 from 2.7% in March. The PPI, excluding Food and Energy, also depicted a downward trend, falling to -0.4% month-over-month and showing a yearly decrease to 3.1% from a revised 3.3%. Despite a bleak manufacturing outlook, the Philadelphia Fed’s Manufacturing Business Outlook Survey indicated recovery with an increase to -4 points from -26.4 in April 2025.

U.S. Retail figures were weak with Monthly Retail Trade decreasing to 0.1% from a revised 1.5% in March. The trend without automobile sales also fell to 0.1% from 0.5%. Weekly unemployment claims saw a minor rise to 229K, adding to concerns about the labor market strength. Overall, these data point towards a sluggish economic performance with industrial and retail sectors under pressure, and mixed signals from inflation parameters.

The weaker-than-expected U.S. economic data are likely to affect the NZDUSD exchange rate. The negative outlook in retail and production sectors, alongside declining PPI figures, suggests limited immediately inflationary pressures in the U.S., which could dampen the dollar’s strength. As a result, the NZD may find support against the USD, particularly if New Zealand’s local data, such as the anticipated RBNZ Survey of Inflation Expectations, provides a more positive economic outlook. However, prevailing market conditions saw the NZDUSD fall by -0.43% to 0.58720 on Thursday, highlighting potential volatility and caution among traders ahead of upcoming events.

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What can we expect from NZDUSD today?

NZDUSD on Thursday dropped -0.43% to 0.58720. Price is below 9-Day EMA while Stochastic is falling.

Updated daily direction for NZDUSD looks bearish as the pair posted lower in Thursday trading session.

Looking ahead for the day, immediate support level is at S1 0.58495 with break below could see further selling pressure towards S2 at 0.5827. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 0.59157 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 0.58601 would indicate selling pressure.

For the week to-date, take note that NZDUSD is mixed as compared to the prior week.

Key levels to watch out:

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