The NZDUSD lower opens at 0.7810 this morning.
The USD gained across the board, pulling the NZDUSD lower, as plunging oil prices raising further deflation concerns in the euro-zone and Japan.
Annual euro-zone consumer inflation slowed to a 5-year low on falling energy prices, highlighting the fact that deflation is a serious issue for the European Central Bank policy makers. Japan’s core inflation declined for the 3rd consecutive month.
It is a big week for central banks with interest rates meeting being held in the UK, Euro-zone, Canada, and Australia. The influential US non-farm payroll employment numbers hit the tapes Friday night, while Fonterra’s latest Global Dairy Trade auction takes place Wednesday morning.
Global equity markets were mixed on the day – Dow 0.0%, Nikkei +1.2%, Shanghai +2.0%, FTSE-0.0%, DAX +0.1%
Gold prices fell 1.8% to USD$1,168. Oil prices plunged 4.0% on the day, this is on top of the 6.5% fall the previous day and a barrel of West Texas Intermediate crude now trades at USD$66, compared with over USD$100 in July.
The current indicative mid-rates are:
NZDUSD 0.7810
NZDEUR 0.6265
NZDGBP 0.4990
NZDJPY 92.70
NZDAUD 0.9225
NZDCAD 0.8925
RBNZ Governor Graeme Wheeler delivers speech on ‘Inflation Targeting’ at 8:45am. This is followed by the release of the NZ Overseas Trade Index at 10:45am.
Chinese manufacturing figures (official and those complied by HSBC) will hit the tapes this afternoon, along with US manufacturing numbers and US Fed-speak tonight.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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