NZD/USD consolidates last week's gains, trades above mid-0.65s

• Manufacturing sales in New Zealand contracted in third quarter.
• US Dollar Index stays quiet following Friday's rebound.
• Kiwi largely ignores trade balance data from China.

The NZD/USD pair registered one of its largest weekly percentage gains last week as it added more than 140 pips to close at 0.6563. However, with investors moving to the sidelines ahead of this week's key events, the pair struggled to preserve its momentum and was last seen posting small daily gains at 0.6557.

The data published from China on Sunday revealed that the Trade Surplus narrowed to $38.73 billion in November from $42.81 billion amid a 1.1% slump in annual exports but was largely ignored at the start of the week. On the other hand, Statistics New Zealand reported that Manufacturing Sales declined by 0.3% in the third quarter to beat the market expectation of -0.8%.

Eyes on FOMC and trade developments

In the meantime, on the back of the upbeat Nonfarm Payrolls data on Friday, the US Dollar Index snapped its five-day losing streak and finished the week on a strong note. Later this week, the Federal Open Market Committee's (FOMC) monetary policy announcements will be critical for the USD's market valuation.

Moreover, investors will be paying close attention to fresh developments surrounding the US-China trade dispute before the US hikes tariffs on Chinese imports on December 15th. Earlier in the day, China’s Assistant Commerce Minister noted that they were hoping to reach a trade agreement with the US as soon as possible. Trade-sensitive antipodeans could gain traction if sides sign the phase-one of the trade deal to avoid additional tariffs. 

Technical levels to watch for

NZD/USD