The NZDUSD opens lower at 0.6688 (mid-rate) this morning.
Financial markets have paused ahead of tonight’s US monthly jobs report. An increase in jobs of circa 150k is expected and the unemployment rate is forecast to remain steady at 3.6%. An uptick in the unemployment rate would lock in a rate cut by the US Federal Reserve on 1 August.
Over the last few weeks we have seen the likes of the NZD and AUD make solid gains vs the US Dollar as expectations of a US rate cut have increased.
The key week for local markets will be early August with both the Reserve Bank of Australia and the Reserve Bank of New Zealand reviewing interest rates on August 6th and 7th respectively. We expect the RBA to hold rates at their new low of 1.0% but we do think the RBNZ will lower rates again down to a fresh record low of 1.25%.
Yesterday in Australia the newly re-elected Government of Scott Morrison passed their massive tax cut package that will see over 10 million Australians receive over AUD$ 1,000 in tax cuts. This extra AUD$10 billion should help boost demand in the economy and may signal we have seen the low point in the AUD for this cycle.
There is no data scheduled on the domestic calendar today. The influential and closely watching US non-farm payroll employment figures will be released tonight.
Global equity markets were generally higher on the day - Dow +0.7%, S&P 500 +0.7%, FTSE -0.1%, DAX +0.1%, CAC +0.1%, Nikkei +0.3%, Shanghai -0.3%.
Gold prices dipped 0.2% to USD$1,415. WTI Crude Oil prices fell 0.6% to US$56.67 per barrel.
Have a nice weekend.
Current indicative rates:
Upcoming Data Releases (NZT):
- No local data today
- 12:30am - USD - US non-farm payroll employment numbers
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