By Dan Bell
The NZD/USD traded down to 0.8060 yesterday after the release of disappointing China manufacturing data.
It attempted to bounce, but more weak manufacturing data hit the tapes overnight, this time from the Germany and the EU, served to keep a lid on any rally as anxiety over the global economy’s growth outlook increased.
The increased nervousness about the global growth has sparked an increased demand for ‘safe haven’ assets such as the USD and US Treasuries (i.e. US Govt bonds), and placed downward price pressure on NZD, Gold, Copper and other base metals, oil, and global equities.
The 19-commodity CRB Commodity Index fell 1.2% on the day. Gold traded as low as USD$1642 per ounce before bouncing back to USD$1642. Oil is circa 0.8% lower.
Equity markets are lower across the board overnight. The US S&P500 currently down 0.9%, while the Dow Jones Index is 0.5% lower on the day.
The NZD opens at 0.8085 USD, 0.7785 AUD, 0.6130 EUR, 0.5110 GBP, & 66.65 JPY.
There is no data on the domestic calendar today.
US New Homes Sales data, along with some US Fed-speak are the most prominent events on the data schedule tonight.
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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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