The NZDUSD opens higher at 0.8730 this morning.
The NZDUSD rallied higher as the USD came under selling pressure after the US Federal Reserve slashed its forecast for US economic growth this year and indicated long-term interest rates could be lower than previously thought in its post FOMC interest rate meeting statement. The Fed also hinted at slightly faster pace of increases in the Fed Funds Rate and expressed confidence the US economy recovery was largely on track.
Another USD$10 billion reduction in monthly bond purchases was announced by the Fed, as was expected.
The minutes from the Bank of England's interest rate meeting held in early June showed the members wanted to see more evidence of a continued reduction in economic slack before committing to raising interest rates. The GBP weakened in response.
NZ Q1 GDP figures will be released at 10:45am.
Global equity markets were mostly higher on the day - Dow +0.6%, Nikkei +0.9%, Shanghai -0.4%, FTSE +0.2%, DAX +0.1%
Gold prices climbed 0.3% to USD$1274. Oil prices gained 0.7%.
The current indicative mid-rates are:
NZDUSD 0.8730
NZDEUR 0.6420
NZDGBP 0.5135
NZDJPY 88.95
NZDAUD 0.9280
NZDCAD 0.9465
NZ Q1 GDP numbers hits the tapes at 10:45am.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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