By Dan Bell
The NZD/USD opens at 0.7945 this morning, having touched a new 6-week low of 0.7917 overnight.
The EUR/USD rallied on reports the European Central Bank (ECB) may purchase more government debt from heavily indebted peripheral EU nations in an attempt to stem the regions debt crisis.
The ECB is expected to announce a bond-buying program after its policy meeting tonight. It is speculated the ECB may buy unlimited amounts of government bonds, from Spain and Italy in particular. The markets are eagerly awaiting this announcement and volatility is likely to result.
Australian GDP figures disappointed yesterday, adding to the view the ‘lucky country’ is showing signs of strain and the Reserve Bank of Australia will lower interest rates in the coming months.
The NZD/EUR, NZD/JPY, & NZD/GBP all remain under selling pressure.
Global equity markets were little changed the day. The US S&P index fell 0.1%, while the European markets rose 0.2% to 0.45%. The Shanghai Composite Index (SSEC) lost 0.3%.
Oil prices fell 0.6%, while Gold fell slightly to USD$1692. Copper prices climbed 1.3% to USD$7,735 a tonne, and other base metals prices were generally 1%+ stronger.
The NZD opens at 0.7945 USD, 0.7795 AUD, 0.6305 EUR, 0.4995 GBP, & 62.30 JPY.
No data on the domestic calendar today, while we get the important Australian employment figures a 1.30pm.
ECB & Bank of England have interest rate policy setting meeting tonight. The ECB is widely anticipated to announce a major bond buying program.
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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
Europe is a slow motion train wreck that will likely place the entire region in recession.
The UK is already in double dip recession.
China's big house of cards is turning slowly toward a major tail spin.
The USA looks about to stall, probably being held up because of the looming elections.
... and the .6% quarterly growth in Australia (annualised 3.7%) is disappointing.
Just maybe your standards are too high!
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