By Dan Bell
While global risk appetite continues to recover overnight, the NZD has underperformed against most major currencies with the NZD/USD traded under 0.8300 at one stage after pushing to a high of 0.8388 yesterday afternoon.
Global equity markets have rallied overnight particularly in the US where the S&P 500 closed up over 2.1% and the Dow Jones finished up 1.9% on the day.
Investors were also more upbeat on news that Google offered to buy Motorola Mobility Holdings for $12.5 billion in cash.
The AUD/USD has been one of the best performing currencies overnight trading over 1.05 after hitting a 5 month low of 0.9930 last week.
The NZD has dropped almost 1% on a trade weighted basis touching a low around 0.7900 AUD, 0.5730 EUR, 63.50 JPY and 0.5047 GBP.
The EUR performed strongly overnight on news the ECB spent a record €22bn on government debt purchases last week to stem the spread of the debt crisis to Spain and Italy.
Nothing to report on the local front today but from Australia we get RBA Monetary Policy Meeting Minutes at 1:30 NZT. We also get another Fonterra auction result tomorrow morning.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here
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