The NZDUSD opens at 0.7238 (mid-rate) this morning.
A combination of broad USD strength and a fall in dairy prices has seen the NZD underperform overnight. The NZD is the weakest of the G10 currencies with the NZDUSD currently trading at 5-week lows.
This morning the latest Global Dairy Trade (GDT) auction resulted in a second consecutive fall in the index. The overall price index decreased by 0.4% following on from a 1.6% fall a fortnight ago, volumes also decreased, down 1.6% with a total of 32,260 tonnes selling under the hammer.
This morning’s US retail sales result for the month of July exceeded expectations sparking a USD rally. The Commerce Department report showed retail sales increased by 0.6% in July while retail sales for the month of June were upwardly revised to 0.4% from a previously reported 0.2% fall.
Inflation in the UK for the month of July came up shy of economists’ forecasts, with consumer prices increasing by 2.6% in July, less than the 2.7% result forecast by economists. The result puts a further dent in the hopes that the BOE will be in a position to raise interest rates anytime soon.
A lack of economic data during our trading day will see investors focus on tomorrow mornings FOMC meeting minutes before adding to their positions.
Global equity markets remain mixed - Dow -0.05%, S&P 500 -0.06%, FTSE +0.41%, DAX +0.10%, CAC +0.36%, Nikkei +1.11%, Shanghai +0.43%.
Gold prices have edged lower, down 0.6% trading at $1,272 an ounce .WTI Crude Oil prices have slipped lower, down 0.6% trading at $47.55 a barrel.
Current indicative rates:
NZDUSD 0.7238 -0.8%
NZDEUR 0.6165 -0.4%
NZDGBP 0.5625 0.0%
NZDJPY 80.01 0.0%
NZDAUD 0.9255 -0.3%
NZDCAD 0.9228 -0.5%
GBPNZD 1.7777 0.0%
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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