Friday, February 19, 2021

New Zealand Dollar Forecast: NZD/USD May Climb Despite Rising Treasury Yields

Wall Street saw red across the board on Thursday as the economic recovery picture took a hit following a worse-than-expected US initial jobless claims figure crossed the wires at 861k for the week ending February 13. Analysts were expecting 765k. Continuing claims also missed expectations at 4494k. The small-cap Russell 2000 index dropped 1.67%, followed by the Nasdaq Composite, S&P 500, and Dow Jones at -0.72%, -0.44%, and -0.38%, respectively.

The US 10-year Treasury yield climbed back near its recent multi-month high from earlier this week, with the current level just below 1.300%. Meanwhile, the US Dollar weakened with the DXY index falling nearly half a percentage point. The softer USD didn’t help gold and silver prices, however. XAU/USD was barely changed as it hovered near multi-month support. Silver prices fell against the Greenback, with XAG/USD dropping 1.29%

Elsewhere, lawmakers on Capitol Hill continued to move forward with finalizing President Joe Biden’s $1.9 trillion stimulus relief package, which is expected to advance through Congress by the end of this month. Talks over a separate infrastructure bill are also now on the radar after President Biden met with labor union leaders earlier this week.

The need for a stimulus bill has also gained steam following the failure of Texas’s power grid after a massive storm system caused chaos across the United States earlier this week. Nearly half a million customers in the Lone Star State are reported without power still. There was testimony on Capitol Hill over the recent GameStop market blunder.

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