The NZDUSD opens lower at 0.8245, having hit an 8-week low of 0.8229 earlier this morning.
The USD rose across the board after US retail sales unexpectedly increased in April, pointing to underlying strength and continuing recovery in the US economy.
There are increasing expectations the US Federal Reserve will begin to scale back its asset-buying program before the end of 2013.
This is in contrast to the aggressive monetary easing in Japan, and risk of negative deposit rates in the euro-zone. While these divergence factors persist, the USD can continue to outperform.
China released disappointing factory data yesterday. This is raising hopes that Beijing will ease monetary policy further to support economic activity.
Global equity markets were mixed, with only some Asian bourses moving more than 1%.
The Gold price dropped over 1.7% to USD$1429 an ounce – a 3-week low.
The NZD opens at 0.8245 USD, 0.8285 AUD, 0.6350 EUR, 0.5390 GBP, & 83.95 JPY.
NZ Retail Sales will be releases at 10:45am today.
German and Euro-zone economic sentiment hit the tapes tonight, along with euro-zone manufacturing data. Aussie’s Annual Budget also get released this evening.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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