By Dan Bell
The NZD/USD rose for a second day, rallying with global equity markets as risk appetite improved. The NZD/USD hit the mid 0.7900’s, while NZD/EUR made an all-time high of 0.6226.
Risk appetite was aided by news that:
- Fitch rating agency is unlikely to downgrade France in 2012
- Positive outlook for global demand from US aluminum giant Alcoa
- Expectations of China easing monetary policy to stimulate its flagging import and export growth, which is seen as boosting demand for commodity-based currencies such as the NZD & AUD.
Equity markets moved higher across the board (the US Dow Jones index up 0.8%).
The CRB index was up 1.3% on the day - Oil prices gained 1.3%, Gold surged 1.5% higher (it currently trades at USD$1633 an ounce), Silver stormed 4.0% higher, and base metals prices were also jumped with Copper up 3.3%.
There is no data on the domestic calendar today.
Current indicative levels are: NZD/USD 0.7940, NZD/AUD 0.7695, NZD/EUR 0.6205, NZD/GBP 0.5125, and NZD/JPY 61.00.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here
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