By Dan Bell
The NZD has been one of the worst performing currencies overnight and is down against all major cross rates.
The NZD/USD has broken through recent trend support at 0.8240 and opens around 0.82 this morning.
Against the other majors we open at current indicative levels - 0.62 EUR, 0.769 AUD, 0.517 GBP, 66.8 JPY.
Global markets are weaker overnight with equities and commodities down across the board- the only thing that bucked the trend was oil prices which continue to hold recent gains over 106 USD bbl - rising oil prices have also been weighing on sentiment lately with one economist suggesting that ‘Oil is the new Greece’.
The S&P 500 is down 0.52% at time of writing and the Reuters CRB Index is down 0.55% with copper -1.15%.
China's Premier Wen Jiabao downgraded their annual growth target to 7.5% (lowest in 8 years) which raised fears about slowing global growth.
Most ‘risk on’ markets have been in an uptrend for the last 3 months so we are not surprised to see a pullback, which may see the NZD underperform in the short term.
Not much to report on the local front. From Australia we get Current Account balance and the RBA this afternoon.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here
(Updated with Dow close)
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