The NZDUSD opens lower at 0.8420 this morning.
The USD rose overnight, nudging the NZDUSD down towards 0.8400 and a fresh 3-month low in the process.
USD benefited from anxiety regarding tonight's expected interest rate cut and other possible stimulatory measures from the European Central Bank. However, the USD gains were trimmed after the ADP employment reported a lower level of employment growth than anticipated.
Main focus tonight will be on the ECB rate cut and accompanying statement and press conference. The EURUSD may be volatile and this would spill over into the NZD.
Global equity markets were mixed on the day - Dow +0.1%, Nikkei +0.2%, Shanghai -1.0%, FTSE -0.3%, DAX +0.1%
Gold prices dropped 0.2% to USD$1243 overnight. Oil prices fell 0.5%.
The current indicative mid-rates are:
NZDUSD 0.8420
NZDEUR 0.6190
NZDGBP 0.5030
NZDJPY 86.50
NZDAUD 0.9075
NZDCAD 0.9215
Nothing is scheduled on the domestic data calendar today.
Australian Trade Balance hit the tapes at 1:30pm.
The Bank of England and European Central Bank both have interest rate policy setting meetings tonight. Attention will be firmly focused on the ECB as the markets expect further rate cuts and stimulatory measures to spark growth and raise the inflation rate.
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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