NZD/USD bulls take a breather into early Asia

• NZD/USD bulls consolidate the upside into the Asian session.
• US dollar licking its wounds on bullish failures. 

At the time of writing, NZD/USD is trading 0.5% higher between a low of 0.7187 and a high of 0.7243.

The bird flew up to a five-week high on Monday as the US dollar nose-dived and risk on Wall Street moved into stocks and the commodity complex.

As noted by analysts at ANZ Bank, ''the Kiwi (and AUD) are outperforming EUR, GBP and JPY, but strength seen over the past 24hrs looks to be broadly commodity-related, rather than NZ-specific.''

The greenback was initially climbing from an eight-week low against major currencies such as the yen and Swiss franc as measured by the DXY which at the time of writing is flat on the day having travelled between a low of 90.6820 and a high of 90.9860.

In general, however, investors consolidating positions ahead of the Federal Reserve's monetary policy meeting this week.

The commodity complex has gained in recent weeks with the US dollar on the back foot, falling nearly 3% since late March as US Treasury yields, which had risen this year and supported the greenback, remain in the doldrums. 

Looking ahead, the highlight of this week is the Federal Reserve meeting.

''We expect the Fed to stand pat and reiterate the need for patience, and to highlight that they will look through any near-term temporary inflation increases, and won’t hike until we see sustained strength in actual data. That mantra is well understood by markets, and it is likely to weigh on the USD,'' analysts at ANZ Bank argued.