The US dollar is starting Wednesday on a weak footing, holding close to low levels against its major rivals as traders stay away from entering new positions before the release of July’s nonfarm payrolls report at the end of the week. At the time of writing, the US dollar index DXY is trading at around 92.10.

Moves across the forex market remain somewhat subdued as investors closely watch the NFP data for clues on the health of the US labor market. The focus on the data has increased especially after the Fed signaled that it would not consider hiking rates or tapering stimulus until employment conditions improve further.

After touching a multi-week peak recently, the US dollar has lost over 1% of its value against its key rivals ever since the latest FOMC saw policymakers play down their hawkish stance from June’s meeting. The dovish tones from Fed Chair Powell have reduced the likelihood of the US central bank tightening its monetary policy or winding up its stimulus efforts anytime soon.

Meanwhile, commodity currency NZD is trading bullish after the release of a better than expected employment report from New Zealand. The nation’s jobless rate dropped to 4% during Q2 2021, touching the lowest levels seen since Q4 2019. The optimistic data has reinforced expectations that the RBNZ could soon announce a rate hike, making it one of the first leading central banks to reverse its dovish policy after the beginning of the coronavirus pandemic over a year ago.

Later today, all eyes will be on the private ADP employment report, which could shed some light on labor market conditions across the world’s most powerful economy. Economists polled by Reuters have forecast that the report could show an increase of 695k jobs in the private sector through July, while the NFP report could show a rise by 880k jobs.