US dollar falls sharply; ECB holds with positive outlook; successful Spanish bond sale; China exports strong, but Fitch has credit concerns; NZ$1 = US$0.844, TWI = 75.6

Here's my quick summary of the key overnight news you need to start your day.

The US dollar is falling sharply against other currencies, and commodities like oil and gold are up in US dollar terms although stable in other currencies. The trigger was strong Chinese export data, and a small rise in first-time claims for the unemployment benefit.

The ECB held its rates unchanged overnight and claimed the euro zone economy will recover later in 2013 and that there are already some signs of stabilisation. The Bank of England also held its rates unchanged. Mario Draghi even claimed there is "positive contagion" happening in Europe.

Meanwhile, the Spanish Treasury raised €5.82 billion from the sale of three bonds, exceeding its upper target of €5 billion. The auctions included a new two-year note with so-called collective-action clauses limiting investors’ rights to oppose writedowns. Markets took this as a 'success' for Spain, even though they lose on the terms.

In China, Fitch is reported to have warned that there is a 60% chance of a downgrade in China's sovereign credit rating by one notch to A+ from AA- because of concernes about unsustainable local government borrowing and the risks to Chinese asset backed securities. And overnight, Fitch cut South Africa's rating one notch to BBB.

But the big Chinese news was the data out showing how strong Chinese exports were in December. They were up 14% from a year earlier, and credit was up 28%. The signs are there that the Chinese economy is growing strongly again, and because exports recovered so strongly, that means that demand from other countries, especially the US, is recovering.

That will help Australia and is one reason why their exchange rate is rising. A halo effect seems to apply to New Zealand and we rose yet again.

The NZ$ opens today at 84.4 USc, 79.7 AUc and the TWI is at 75.6. That is another big rise against the US dollar, but virtually unchanged against the other currencies we monitor.