NZD/USD rebounds modestly from daily lows, turns flat near 0.6430

• NZD/USD trades in the lower half of its weekly trading range.
• US Dollar Index consolidates weekly gains around mid-97s. 
• FOMC Chairman Powell is scheduled to deliver a speech at 1700 GMT.

The NZD/USD pair is trading in a relatively tight range this week after failing to break above 0.6500 on Tuesday. As of writing, the pair, which dropped to a daily low of 0.6407, was virtually unchanged on the day at 0.6430.

The data from New Zealand on Thursday revealed that the economy contracted by 1.6% on a quarterly basis in the first quarter. Although this reading came in worse than the market expectation for a fall of 1%, the upbeat market mood allowed the risk-sensitive NZD to stay resilient against its major peers.

DXY consolidates gains ahead of Powell speech

On the other hand, the selling pressure surrounding major European currencies helped the USD gather strength and made it difficult for the pair to advance higher. After falling 0.5% on Monday, the US Dollar Index (DXY) closed the last three days in the positive territory and gained nearly 0.8% during that period. At the moment, the DXY is flat on the day at 97.46.

In the second half of the day,  Jerome Powell, Chairman of the Federal Reserve, and Randal Quarles, Vice-Chair of the Federal Reserve, will be speaking at 1700 GMT and 1600 GMT, respectively.

The only data featured in the US economic docket will be Current Account for the first quarter but is unlikely to trigger a significant market reaction.

Technical levels to watch for