NZD/USD attempts a comeback above 0.6150 while the risk-off impetus remains active

After a sharp decline to roughly 0.6160 in the late New York session, the NZD/USD pair has detected some bids. After ceding the round-level support at 0.6200, the New Zealand dollar was subject to severe selling pressure on Monday. A comeback effort near 0.6160 should not be seen as a reversal because the market sentiment is still cautious and a cushion has not to be determined.

After a V-shaped rebound from a low of 105.40, the US Dollar Index (DXY) has extended its gains to approximately 106.67. China's escalating demonstrations against the Covid-19 lockout have had a substantial effect on commodity-linked currencies, which are their primary trade partners. Therefore, the decrease in antipodean currencies is greater than gains in the USD Index.

S&P500 has suffered huge losses, indicating a negative market sentiment. Ahead of a speech by Federal Reserve (Fed) chair Jerome Powell, returns on US Treasury bonds remain modest. After a modest recovery, the 10-year US Treasury yields remain below 3.70 percent. It appears that apprehension in advance of Fed Chairman Powell's speech has sidetracked them.

In addition to Fed Powell's speech, investors are monitoring the Automatic Figures Processing (ADP) Employment data for the United States. According to calculations, the US economy created 200k more jobs in November than previously reported. Higher interest rates and poorer economic prospects have compelled companies to maximize the utilization of their present workforce and delay the recruitment process, resulting in a decline in the number of jobs created over the past few months.