By Dan Bell
The NZD/USD has come under pressure shedding over 100 points after a German official said the European Union summit on the 23rd October would not provide a “definitive solution” as many had been hoping. The NZD opens in the low 0.79’s this morning after trading to a high of 0.8069 yesterday.
Global markets turned negative overnight after German Finance Minister Wolfgang Schaeuble said EU governments will not present an ultimate plan at their 23rd October summit and that the crisis will surely extend into next year…who would have thought!?
Stock markets are lower across the board with the S&P 500 currently down 1.4%. Commodities are also weaker with the CRB Index off 0.83%.
The US Dollar and Japanese Yen have benefited from safe haven demand overnight as risk aversion takes over. The EUR/USD has dropped from 1 Month highs over 1.39 to 1.3729 this morning while the AUD/USD is off over 150 points back under 1.02.
The NZD opens around familiar levels against the major cross rates around 0.7780 AUD, 0.5760 EUR, 0.5035 GBP and 60.90 JPY.
Today the focus will be on a raft of Chinese data with GDP, Industrial Production and Retail Sales released around 3:30pm NZT. Nothing to report on the local front but from Australia we get Monetary Policy Meeting Minutes at 1:30.
-------------
Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.