NZD/USD retreats to 0.7000 area, on track to close fourth straight day lower

After closing the prior three trading days in the negative territory, the NZDUSD pair rose to an everyday a lot of 0.7057 in the early European session but reversed its direction in the second 50% of the day. As of writing, the pair, which touched a three-week low of 0.6694 throughout the American trading hours, was down 0.3% on the afternoon at 0.7003.

DXY rebounds as investors turn cautious

In the absence of high-tier macroeconomic data releases, risk perception remained the principal driver of NZD/USD's movements on Tuesday. Earlier in the afternoon, the upbeat market mood, as reflected by strong gains in major European equity indexes, made it hard for the USD to locate demand.

Although Wall Street's main indexes opened decisively higher, they struggled to gather bullish momentum and the USD began to regain its strength, forcing NZD/USD to show south. At this time, the S&P 500 Index is unchanged on the afternoon at 4,358 and the US Dollar Index is flat at 93.22.

In the meantime, the info from New Zealand revealed that the GDT Price Index increased by 1% following the most recent auction. Nevertheless, this reading didn't trigger a noticeable market reaction.

On Wednesday, the People's Bank of China (PBoC) will publish your choice on the 1-year and 5-year loan prime rates. Investors expect the bank to leave those rates unchanged at 3.85% and 4.65%, respectively. However, a surprise rate cut because of the Evergrande crisis could give a boost to the NZD throughout the Asian trading hours.