NZD/USD was at a standstill earlier on Tuesday after the release of New Zealand’s retail sales data for the second quarter. The pair inched slightly higher to trade at $0.6899.
New Zealand’s Retail Sales
According to data publishes by Stats NZ earlier on Tuesday, the total retail sales volume advanced 3.3% in the June 2021 quarter, following a 2.8% rise in the March 2021 quarter. Most retailers reported an increase in sending across all regions. According to them, customers majored their spending on big-ticket items such as vehicles and electrical goods in the June quarter.
Electrical and electronic goods led the gains in sales volumes after jumping 6.9%. Food and beverages followed closely, climbing 5.6%. Including the effects of price changes, the seasonally adjusted value of total retail trade sales rose 4.0% in the second quarter.
Food and beverage services had the largest dollar value increase, up 7.0% in the June quarter. Sales volumes for motor vehicle and parts retailing were above $4 billion, hitting records high. The industry recorded a 4.6% increase in the same quarter.
The overall total value of retail sales jumped 37% compared to the June 2020 quarter when the Covid-19 virus struck.
The NZD/USD pair will react to the US New Home Sales data for July due later in the day. Economists expect the new home sales for the previous month to come in higher at 700,000.
NZD/USD Technical Analysis
The NZD/USD pair took a deep dive of almost 4% last week before bouncing back on Monday. The currency pair has jumped more than 1% in the last 24 hours snapping its seven-day losing streak.
The currency pair is trading below the 25 and 50-day exponential moving averages, hinting at a bearish trend. It is also trading below the 200-day moving average, reinforcing the bearish outlook.
Therefore, further weakness is likely to be demonstrated once the currency pair moves below the support at $0.6800. However, a move above the 50-day EMA will invalidate this view. If this happens, the next suitable target will be the resistance at the 200 DMA at $0.71120.