The NZDUSD opens sharply lower at 0.7970 this morning, having hit a 9-month low of 0.7930 overnight.
Risk is firmly off the table for the moment and the NZD has suffered as a consequence.
Global equity markets all suffered sizable falls (Japan’s Nikkei index fell 3.8%) and US data did not live up to expectations.
The US ADP employment report, the precursor to Friday’s all-important US non-farm payrolls employment figures, disappointed overnight as did factory orders and unit labour cost figures.
Australia’s Q1 GDP numbers came in worse than expected, and it has been reported that Western Australia – the formerly booming mining state – is in recession. The AUDUSD fell to 18-month lows, and this also weighed on the NZDUSD.
The USD lost ground against the EUR, GBP, and JPY overnight. The NZDEUR, NZDGBP, and NZDJPY are all at multi-month lows.
Global equity markets are markedly lower across the board. All the major indices fell by more at least 1.25%, with the Nikkei plunging 3.8%.
Gold prices rose a little to USD$1403 an ounce overnight.
The NZD opens at 0.7970 USD, 0.8350 AUD, 0.6085 EUR, 0.5170GBP, & 78.95 JPY.
There is no data on the domestic calendar today.
Australian Trade Balance will be released at 1:30pm.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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