The NZDUSD opens higher at 0.8525 this morning.
The NZDUSD followed the AUDUSD higher overnight, even as the USD strengthened and the EUR fell.
After the recent ECB monetary policy easing, funds are flowing out of the EUR in the search of higher yields - this is benefiting the AUD, and to a lesser extent the NZD.
The USD is supported by strong economic data, and there are growing expectations the US Federal Reserve may start to raise interest rates sooner than previously forecast (circa 12 months time). The Fed has an interest rate policy meeting next week.
The RBNZ monetary policy announcement will be made at 9am tomorrow. Market expectations are for the OCR to be increased by 0.25% to 3.25% - most focus will be on the accompanying statement for indication on the pace of future rate hikes and on the NZD.
Global equity markets were mixed on the day - Dow +0.0%, Nikkei -0.9%, Shanghai +1.3%, FTSE -0.0%, DAX +0.2%
Gold prices are higher at USD$1260. Oil prices dropped 0.3%.
The current indicative mid-rates are:
NZDUSD 0.8525
NZDEUR 0.6290
NZDGBP 0.5085
NZDJPY 87.20
NZDAUD 0.9095
NZDCAD 0.9295
Nothing is scheduled on the domestic data calendar today.
Westpac consumer sentiment hit the tapes at 12:30pm from Australia.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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