The New Zealand dollar fell on Thursday, after data showed the economy has contracted at largest quarterly pace in nearly three decades in Q1.

Data showed today the New Zealand GDP shrank by 1.6% in Q1 compared to Q4 2019, at the largest quarterly pace since 1991.

The GDP also shrank 0.2% year on year, for the first time since 2009, amid forecasts for another quarterly contraction in this quarter by 19%.

This came as New Zealand and several other countries are battling the coronavirus pandemic, and its impact on their economies.

As of 16:21 GMT, NZD/USD fell 0.4% to 0.6431, after hitting a high of 0.6478 and a low of 0.6421.

Oil prices rose on Thursday, to resume gains after pausing yesterday, after data showed a large drop in the US oil output, and fears eased over a second wave of the coronavirus infections, after China contained the last coronavirus outbreak in Beijing.

The US crude rose 2% to $38.44 a barrel, after it opened at $37.68, and hit an intraday low of $37.13, and Brent crude rose 2.1% to $41.26 a barrel, after it opened at $40.39, and hit a high of $40.08.

The US crude fell 0.5% yesterday, and Brent crude futures fell 0.4%, posting the first daily drop on fears over a second coronavirus outbreak.

The Energy Information Administration (EIA) unveiled yesterday that US the oil production fell 600,000 bpd in the week ending June 12, to a total of 10.5 million bpd, the lowest level since March 2018. However, the US remains the world's largest oil producers.

During the past two months and a half, the US production fell about 2.6 million bpd, or 20% of its total, which indicate a suspension in the US production activity due to the falling prices.

OPEC stressed in its June report that the market will remain oversupplied in the second half of 2020, despite recovering global demand levels, and estimated that supply from outside the OPEC-Plus coalition could rise up to 300 thousand bpd.

Reuters quoted informed sources in OPEC-Plus that the compliance to the output cuts rate was 87% in May.

Otherwise, official Chinese news outlets said that health authorities have been successful in containing the coronavirus epicenter in Beijing, which eased fears over a second wave of the outbreak.

The US dollar rose against most majors on Thursday, extending its gains for the third straight day, on improved demand due to gloomy outlook of the US economy following the Fed Chair Jerome Powell during his semi-annual testimony before Congress. This comes ahead of the release of the US weekly jobless claims data, which provide key insight over the US labor market after relaxing the coronavirus restrictions.

The dollar index rose 0.3% to 97.34 points, after it opened at 97.08, and hit an intraday high of 96.95.

The index rose 0.1% yesterday, posting the second straight daily gain, on improved demand as the best alternative investment.

Federal Reserve Chairman Jerome Powell said yesterday before the House Financial Services Committee that the economy is recovering from the coronavirus, but more than 25 million jobs were lost, and the economy will need more support.

Powell added that levels of output and employment remain far below their pre-pandemic levels, adding that the economy might need more support.

Jerome Powell also stated that the full economic recovery will not occur unless the American people are assured of the full containment of the coronavirus.

Investors are anticipating the release of the US weekly unemployment claims report, which provide key insight over the US labor market after relaxing the coronavirus restrictions.

At 12:30 GMT, the US economy will release the unemployment claims reading, with forecasts of 1.300 million during the week ending June 13 vs. 1.542 million during the previous week.

The US economy closure since mid-March has led around 43.5 million American workers to apply for unemployment benefits, and pushed the US unemployment rate to its all-time high of 14.7% during April.

At 12:30 GMT, the US department of labor revealed that the unemployment claims reached 1.508 million in the week ending June 13, worse forecasts of 1.300 million, and slightly better the the previous reading of 1.566 after it was revised from 1.542 million.