Ella 
The U.S. dollar rebounded after falling for two consecutive days, causing the NZD/USD pair to fall back and fall to around 0.5840 in early European trading on Tuesday. In addition, the manufacturing purchasing managers index released by the National Bureau of Statistics of China unexpectedly dropped to 49.5 in September. The previous value was 50.2.
China’s National Bureau of Statistics released the services purchasing managers’ index in September, which also fell to 50.6, lower than the expected 51.8 and the previous value of 51.7, which heightened concerns about China’s economic conditions. The simultaneous contraction of manufacturing and services raises significant concerns about the health of China’s overall economy, which could weaken the New Zealand dollar as New Zealand is China’s largest trading partner.
On Tuesday, New Zealand reported a seasonally adjusted monthly rate for building consents, which fell 4.7%, compared with a 0.7% decline in the previous month. The Reserve Bank of New Zealand (RBNZ) is expected to take a more accommodative stance on interest rates following weak consumer price index (CPI) data, which will weigh on the New Zealand dollar.
Later this week, New Zealand’s third-quarter employment changes and unemployment rate are likely to be key indicators that market participants will watch closely. These data points provide valuable insights into the labor market, providing clues to the country’s economic situation, job creation and overall employment conditions.
The U.S. ADP employment change for October and the ISM manufacturing PMI may provide a broader perspective on the U.S. economic situation. These data points can greatly influence market sentiment and help provide an overall assessment of the health and performance of the U.S. economy.
Additionally, expectations that the U.S. Federal Reserve will keep interest rates at 5.5% at its upcoming policy meeting are also a key factor. This expectation, if realized, would lead to increased demand for U.S. Treasury bonds, putting downward pressure on U.S. Treasury yields. The interplay of these dynamic factors could have an impact on the US Dollar (USD), making it an important consideration for traders in the current market environment.
