NZD/USD inches lower to near 0.6000 ahead of US Durable Goods Orders data

• NZD/USD struggles as recent jobless claims data has bolstered the likelihood of the Fed keeping rates unchanged at next week.
• The New Zealand Dollar may regain its ground due to improved market sentiment.
• Markets are pricing in a 75% chance that the RBNZ will deliver a 25 basis point rate cut in August.

NZD/USD loses ground for the second successive day, trading around 0.6020 during the early European hours on Friday. The pair depreciates as the US Dollar (USD) gains ground, possibly driven by the recent United States (US) jobless claims data, which has bolstered the likelihood of the Federal Reserve (Fed) keeping interest rates unchanged at next week's meeting. Markets are now pricing in fewer than two rate cuts for the year, with the first fully expected in October. US Durable Goods Orders for June will be eyed later in the day.

The US Initial Jobless Claims fell to 217,000 last week, down from 227,000 and 221,000 in the prior weeks. This marks the sixth consecutive weekly decline, the longest streak since 2022, underscoring the resilience of the labor market.

The preliminary S&P Global US Composite Purchasing Managers Index (PMI) data rose to 54.6 in July, up from 52.9 in June, signaling the fastest pace of overall business activity in seven months. The Services PMI rose to 55.2, beating expectations of 53.0 and reflecting solid demand in the services sector. However, the Manufacturing PMI dropped to 49.5, down from a prior reading of 52.0 and below the forecast of 52.5, slipping into contraction territory.

However, the NZD/USD pair may regain its ground amid improved market sentiment, driven by recent United States (US) trade developments with the European Union (EU) and Japan. Traders further monitor developments in the US-China trade talks. US Treasury Secretary Scott Bessent announced earlier this week that American and Chinese officials will meet in Stockholm next week for a third round of high-level talks.

Markets are pricing in a roughly 75% probability that the Reserve Bank of New Zealand (RBNZ) will cut its 3.25% cash rate by 25 basis points at its August meeting. Meanwhile, RBNZ Chief Economist Paul Conway stated on Thursday that the central bank is prepared to lower rates further if inflationary pressures continue to ease as expected.