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The Opening Bell: Where currencies start on Wednesday, January 11, 2012

Currencies
The Opening Bell: Where currencies start on Wednesday, January 11, 2012

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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1 Comments

Must be a QE comming.

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