The NZDUSD opens higher at 0.8560 this morning.
The USD weakened across the board after data showed US Midwest business activity shrank unexpectedly – this follows disappointing US Q1 GDP figures released last week.
However, US home prices were a bright spot as data showed they rose at their fastest rate in almost 7-years in February.
Expectations are the US Federal Reserve will continue its bond-buying program as recent data will not be giving them much comfort that the US economic recovery is anywhere strong enough to remove stimulus.
Euro-zone inflation hit a 3-year low, unemployment rose to a record high, German’s retail sales for March fell unexpectedly, and Spain’s economy contracted for the 7-th consecutive quarter.
The EUR/USD rallied to a 2-week high on expectations the European Central Bank will cut rates by 0.25% to 0.50% at its rate setting meeting Thursday night.
Gold is trading at USD$1475 an ounce in choppy trading, while Copper prices fell more than 1%.other base metals also suffer losses.
Global equity markets were little changed on the day.
The NZD opens at 0.8560 USD, 0.8255 AUD, 0.6500 EUR, 0.5510 GBP, & 83.35 JPY.
There are no data releases on the domestic calendar today.
Chinese manufacturing data (PMI) hits the tapes at 1:00pm – this will be closely watched for indications of the strength on their economy.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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