• The Kiwi pair struggles on Friday ahead of US NFP data.
• US dollar is strongly favored by the Fed policymakers comments and the FOMC minutes.
• Virus woes in New Zealand and Australia weighs on the consumer sentiment and exerts downward pressure on the NZD/USD pair.

The Kiwi pair is under pressure on Friday. The rationale behind this can be related to pre-NFP cautious and a light calendar in Asia-Pacific and the latest Fed policymakers comments and FOMC minutes favored the US dollar.

Due to the persistence of uncomfortably high inflation, even the most dovish of U.S. central bankers have now agreed that they will need to tighten policy this year; the debate is has changed from whether to how quickly.

St. Louis Fed President James Bullard on Thursday said “Federal Reserve could raise interest rates as soon as March and is now in a “good position” to take even more aggressive steps against inflation, as needed.”

San Francisco Fed President Mary Daly, long a dovish counterpoint to Bullard’s hawkishness, reiterated at a separate event that she too expects interest rate increases this year, even as she warned that overly aggressive tightening could hurt the job market.

And speaking earlier this week, Minneapolis Fed President Neel Kashkari said “he now expects two rate hikes this year, a reversal from his long-held view that the Fed should hold off on rate hikes until 2024.”

US Initial Jobless claims released on Thursday came downbeat with 201K reading more than forecast of 201K and Trade balance also came downbeat with reading of $-80.172 B Vs eepctation of $-74.117 B which was followed by downbeat ISM Non manufacturing PMI – 62.0 against expectation of 65.8. However, the downbeat data did not impact the US dollar bulls since market was showing strong reaction to the Fed rate hike.

Talking about the Virus woes, Virus continue to worsen the situation in Australia and New Zealand. New Zealand  Herald cited 19 and 43 new community cases and infections at the borders compared to 17 and 23 respective figures marked the previous day.

After months of very low numbers, Australia has now seen an explosion in new coronavirus cases in the past few weeks which has hit consumer sentiment and spending, particularly in the services sector. The resulting illness and the need for cases to isolate has hit supply distribution and emptied some shelves in supermarkets.

Analysts are starting to trim forecasts for household consumption this quarter, while the Reserve Bank of Australia’s (RBA) optimism about a rapid recovery is being largely tested.

NZD/USD 4 Hour Chart:

Support: 0.6721 (S1), 0.6695 (S2), 0.6657 (S3).

Resistance: 0.6784 (R1), 0.6822 (R2), 0.6848 (R3).

Fed hawkish rhetoric and the virus woes entertain the NZD/USD sellers, moving on US NFP data is largely eyed today. In the meantime, We expect a bearish trend for NZD/USD.