The NZDUSD opens sharply higher at 0.7905 this morning.
Australian Q2 GDP, released yesterday, hit the forecast number of +0.6%. This spark a strong rally in the AUDUSD, which dragged the NZDUSD high. The NZDAUD fell to a 7-week low of 0.8575.
The USD weakened overnight on data reflecting a growing world economy. This helped to propelled the NZDUSD to further gains, hitting a 2-week high of 0.7925.
There is still uncertainty surrounding any US military strike against Syria. Russia said it would drop its opposition if it was proven the al-Assad regime was responsible for the chemical attack, but it would require US Security Council approval first.
The market will now focus on Friday evening’s key US non-farm payroll employment figures. Strong job gains will cement expectations that the US Federal Reserve will announce plans to trim its stimulus when it meets later this month – this is likely to be USD positive.
Global equity markets were generally higher on the day – Dow +0.65%, Nikkei +0.5%, Shanghai -0.2%, FTSE +0.1%, DAX +0.2%.
The Gold Price was dropped 1.7% to USD$1392 an ounce. Oil prices weakened by 0.7% and base metal prices fell across the board.
The NZD opens at 0.7905 USD, 0.8620 AUD, 0.5985 EUR, 0.5060 GBP, & 78.85 JPY.
There is no data scheduled on the domestic calendar today.
Australian Trade Balance will be released at 1:30pm, followed by the Reserve Bank of Japan monetary policy statement this afternoon, Bank of England & European Central Bank interest rate decisions tonight.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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