By Dan Bell
The NZD/USD surged to new recent highs on Friday just under 0.82 and opens not far off this level at 0.8180 this morning.
Markets put a positive spin on news that Spanish Prime Minister Mariano Rajoy is getting closer to asking for a bailout.
His comments, at his first post-cabinet meeting news conference since taking office last December, came a day after the European Central Bank signalled it was preparing to buy Spanish and Italian bonds but only after EU bailout funds were triggered and countries had asked for help.
Global stocks rallied with the S&P 500 up 1.9%. European equities were up over 4% and Commodities gained 2.1% as measured by the CRB Index.
Adding to the positive tone was better than expected US jobs numbers- Non Farm Payrolls data showed the US economy added 163K new jobs in July compared to expectations of 100K- although the unemployment rate inched up to 8.3% from 8.2%.
The EUR/USD rallied over 1.5% to record its best day since the end of June. The AUD/USD traded to a high of 1.0570.
The NZD opens at current indicative levels: 0.7740 AUD, 0.66 EUR, 0.5240 GBP, 64.30 JPY.
Not much to report on the local front today. It’s a NSW bank holiday today so will be quiet in Australia as well. The main focus this week will be NZ Employment Data on Thursday.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here
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