The NZDUSD opens lower at 0.7260 this morning.
Big news on the domestic front was the threat to contaminate baby milk formula over the use of 1080 poison. The NZDUSD fell 50 points when the listed milk companies’ shares were placed on a trading hold; however the NZD largely bounced back after the official news release.
The USD strengthened against a basket of currencies to its highest levels since September 2003. This pulled the NZDUSD to a 5-week low of 0.7260. The USD is touched a 12-year peak against the EUR and an 8-year high versus the JPY.
Renewed concerns on Greece’s finances remain unresolved and will continue to weigh on the EUR.
Global equity markets were sharply lower on the day – Dow -1.6%, Nikkei -0.7%, Shanghai -0.5%, FTSE-2.5%, DAX -0.7%
Gold prices, pressured by the strong USD, fell 0.6% at USD$1,160. Oil prices (Brent crude) plunged 4.0% to USD$56.43 per barrel.
The current indicative mid-rates are:
NZDUSD 0.7260
NZDEUR 0.6790
NZDGBP 0.4815
NZDJPY 88.00
NZDAUD 0.9540
NZDCAD 0.9205
There are no data releases scheduled on the domestic calendar today.
Australian Consumer Sentiment, Chinese Industrial Production & Retail Sales hit the tapes this afternoon.
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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