The NZDUSD opens lower at 0.6286 this morning.
The NZDUSD sold off overnight as global slowdown fears increased and US Fed officials remained confident the US would raise interest rates this year, boosting the USD.
Renewed concern about China’s economy sent commodity prices tumbling – copper prices were hit particularly hard falling 4% on the day.
This negative sentiment weighed heavily on global equity markets and commodity based currencies such as the NZD & AUD.
European Central Bank board member mentioned they were prepared to add more stimulus if inflation remains below target. The EUR weakened in response.
It has been a very light so far this week on the domestic data calendar and today is no different. Major data focus today will be on the 1:45pm released of Chinese manufacturing figures.
Global equity markets were mostly sharply lower on the day – Dow -1.4%, Nikkei closed, Shanghai +0.9%, FTSE -2.8%, DAX -3.8%
Gold prices dropped USD$7 to USD$1,125 an ounce. Oil prices (WTI) plunged 1.8% to USD$45.82 per barrel on glut concerns.
Indicative mid-rate pricing:
NZDUSD 0.6286 -0.4%
NZDEUR 0.5650 0.2%
NZDGBP 0.4090 0.3%
NZDJPY 75.50 -0.9%
NZDAUD 0.8871 0.3%
NZDCAD 0.8337 -0.2%
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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