NZD/USD was trading higher on Wednesday ahead of US ADP Nonfarm Employment Change for July. The currency pair was trading higher at $0.70541 after the release of New Zealand’s employment change for the second quarter.
New Zealand’s Employment Outlook
New Zealand published its employment rate for the second quarter earlier in the day. Despite the rise in Coronavirus infections, the unemployment rate in the country has been decreasing. The unemployment rate continued falling from its 5.3% peak in September 2020 quarter to 4.0% in the June quarter of 2021.
The number of unemployed people fell 12.4% over the quarter to 117,000 hitting a record high. The quarterly change in unemployment was the largest falloff since the survey began in 1986.
The number of underutilized people fell sharply by 13.3% over the quarter. This was the sharpest decline since 2004. The seasonally adjusted underutilization rate fell to 10.5% in the June quarter of 2021.
The quarterly employment change for the June quarter rose 1.0%, up from the previous 0.6%. The adjusted employment rate rose 67.6% over the year. Wage inflation was 2.1% in the year to the June 2021 quarter.
The NZD/USD pair will react to the ADP Nonfarm Employment Change for July in the United States. Economists polled by Dow Jones expect the numbers to increase to 695,000 from the previous 692,000. The ISM Non-Manufacturing PMI for July will also be released later in the day. The index is expected to increase to 60.5% from 60.1.
NZD/USD Technical Outlook
The NZD/USD pair has been range-bound since mid-June. It has been trading within a tight range of $0.7072 and $0.6915.
At the time of writing, the currency pair was up 0.52% at $0.7054. On the daily chart, it is trading above the 25 and 50-day exponential moving averages (EMAs). Its trend hints at a bullish outlook. However, I expect the pair to continue trading within the congestion area in the near term.
A move above the higher trendline at $0.7072, might push it to find resistance at the $0.7100 level. If this happens, the bulls will be targeting the resistance level at $0.7228. On the flip side, a bearish move past $0.6915, might drag the pair to find support at $0.6882.