The NZDUSD opens at 0.6314 this morning.
The USD continued to strengthen overnight against all of its major competitors, extending gains from Friday.
Investors were concerned with the health of the global economy late last week, after the Federal Reserve decided to leave interest rates unchanged.
However, recent comments from Fed officials has traders feeling more confident that a rate hike will be announced before the end of the year and perhaps as soon as October.
Existing home sales in the U.S. fell by much more than expected in the month of August. They tumbled 4.8% to a seasonally adjusted annual rate of 5.31 million in August from a downwardly revised 5.58 million in July.
Economists had been expecting existing home sales to dip to a rate of 5.50 million from the 5.59 million originally reported for the previous month.
German producer prices fell 1.7% year-over-year in August, following a 1.3% decrease in the previous month. Economists had forecast a 1.6% drop for the month. Producer prices have been falling since August 2013.
Bank of England (BoE) deputy governor Jon Cunliffe said overnight Britain's economy is "pretty strong" and that the next interest rate move should be in an upwards direction. The UK has had the sharpest drop in unemployment for 40 years and consumer confidence is at record highs.
Global equity markets were up except Hong Kong and Japan – Dow +0.91%, S&P 500 +0.66%, FTSE +0.08%, DAX +0.33%. CAC 40 +1.09%, Nikkei -1.96%, Shanghai +1.89%, Hang Seng -0.80%
Gold prices are down $7 to USD$1,132 an ounce. Oil prices (WTI) regained most of yesterday’s losses to be up 4.25% to USD$46.58 per barrel.
Indicative mid-rate pricing:
NZDUSD 0.6314 -1.3%
NZDEUR 0.5640 -0.6%
NZDGBP 0.4076 -1.1%
NZDJPY 76.15 -0.9%
NZDAUD 0.8847 -0.7%
NZDCAD 0.8350 -1.3%
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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