NZD/USD off 2-week lows, still in the red just above mid-0.6700s

   •  Adds to the overnight slump after disappointing NZ employment report.
   •  Speculations over interest rate cuts add to stronger USD-led selling bias.

The NZD/USD pair was seen oscillating in a narrow trading band near the lower end of its daily trading range and consolidating recent losses to near two-week lows. 

The pair added to the overnight slump and remained under some selling pressure for the second straight session in wake of disappointing NZ employment details, which fueled speculation over future interest rate cuts.

According to data released by Statistics New Zealand this Thursday, country's unemployment rate rose more-than-expected 4.3% in the fourth quarter as against the upwardly revised 4.0% rate recorded in the previous quarter.

Meanwhile, the annual wage growth ticked higher to 2.0% as compared to 1.9% in the previous quarter, though quarterly wage growth held steady from the previous quarter at 0.5% and did little to lend any meaningful boost.

Adding to this, a follow-through buying around the greenback, lifting the key US Dollar Index to two-week tops, further collaborated to the pair’s heavily offered tone and intraday slide to levels below mid-0.6700s, the lowest since Jan. 25.

The bearish pressure now seems to have abated, at least for the time being, as market participants now assess the impact of today’s weaker domestic data on RBNZ’s policy outlook, when it holds the first meeting of the year next week.

Technical levels to watch