The NZDUSD opens lower at 0.8540 this morning.
The NZD was pressured as the EURUSD fell to a 3-month low on disappointing German business confidence figures, which is reinforcing expectations the European Central Bank will ease monetary policy sooner rather than later.
Nervousness surrounding Sunday's European Union election results added to the negative EUR sentiment.
High yielding currencies such as the NZD have been pressured in recent weeks. Concerns the pace of NZ interest rate raises will slow, the ongoing slide in global dairy prices, mixed to weak data from China, and a weak AUD have combined to dim the appeal of the NZD.
There is a UK bank holiday Monday while US markets will be closed for Memorial Day - expect the markets to be relatively range bound.
There is not a lot of the domestic data calendar this week. Trade Balance hits the tapes today at 10:45am, followed by Business Confidence & Fonterra farmer payout announcement on Wednesday, and NZ Building Consents Friday.
Global equity markets were higher on the day - Dow +0.4%, Nikkei +0.9%, Shanghai +0.8%, FTSE -0.1%, DAX +0.5%
Gold prices are little changed at USD$1292. Oil prices gained 0.2%.
The current indicative mid-rates are:
NZDUSD 0.8540
NZDEUR 0.6270
NZDGBP 0.5075
NZDJPY 87.05
NZDAUD 0.9250
NZDCAD 0.9285
NZ Trade Balance will be released 10:45am today.
European Central Bank President gives a speech 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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