By Dan Bell
NZDUSD made a new post float high overnight, and continues to hold its ground above 0.8600 this morning.
Last night’s EU debt summit announced an extension of loans to Greece from 7.5 years to a minimum of 15 years. There were no details offered on the size of any new aid given to Greece.
The powers of the European Financial Stability Facility are to be expanded to enable the swift recapitalization of Eurozone banks and intervention in bond markets if necessary.
Equity markets were firmly higher on the day, with the Dow and S&P500 closing up 1.21% and 1.35% respectively. Aside from the return to risk appetite spurred by positive comments with regard to Greek debt, the main driver here was better than expected earnings results from Morgan Stanley, as well as other US corporates.
EURUSD currently sits at 1.4400, 2 week highs for the pair. USD is sharply weaker across the board.
The rest of this week is quiet as far as data releases are concerned. Next week sees NZ’s Trade Balance on Tuesday, NBNZ Business Confidence on Wednesday, and the RBNZ OCR announcement on Thursday.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here
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