The NZD/USD opens around 0.8170 this morning after trading to lows around 0.8130 on Friday night.
The NZD/USD is down over 200 basis points from last week's highs and continues to look vulnerable.
US stocks finished last week on a positive note with the S&P 500 closing above the 1,800 level up 0.50%.Commodities were mixed with gold down 0.1% and oil down 0.75%.
The correlation between a strong NZD/USD and the so called 'risk on' trade is breaking down. Better than expected US data is underpinning confidence in the US stock market and supporting the US Dollar.
The NZD has outperformed the AUD which has seen NZD/AUD trade to 5 year high around 0.8950 last week. The market is still pricing in a small chance of further rate cuts from the RBA next year.
This morning the NZD opens at 0.89 AUD, 0.6027 EUR, 0.5032 GBP, 0.8593 CAD, 82.73 JPY.
Nothing to report on the local front today. The market will be focused on US economic data this week with Pending Home Sales 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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