The NZDUSD opens at 0.6891 (mid-rate) this morning.
The NZD spiked higher following yesterday’s stellar employment report. The data came in well ahead of economists forecasts, with employment rising by 2.2% in Q3 (exp +0.8%), while unemployment fell to 4.6% (exp 4.7%). The NZDUSD which is currently trading back below 0.69 peaked overnight at 0.6928.
Overnight and ahead of this morning’s FOMC statement the USD received a boost on the back of better than expected economic data. Private sector employment for the month of October increased by 235k jobs following a downwardly revised 110k jobs in September. Economists had expected the addition of 135k jobs, while September’s jobs gains were originally reported at 135k.
As expected the Federal Reserve has kept the Funds rate unchanged at 1.0%-1.2% and delivered what appears to be a balanced statement. The Fed confirmed that they are on track to continue to hike rates gradually, with the economy expected to continue to expand at a moderate pace. The Fed also confirmed that the balance sheet normalisation which was initiated in October is proceeding. The market is currently pricing in a 98% chance that the Fed will hike in December.
The UK Purchasing Managers' Index (PMI) rose to 56.3 in October, up from a revised 56.0 reading in September. Economists had expected the index to remain unchanged from Septembers original 55.9 reading.
Global equity markets with the exception of the FTSE are edging higher- Dow +0.08%, S&P 500 +0.16%, FTSE -0.07%, DAX +1.78%, CAC +0.20%, Nikkei +1.86%, Shanghai +0.08%.
Gold prices have retraced yesterday’s fall, up 0.7% trading at $1,277 an ounce. WTI Crude Oil prices have continue to rise, up 0.3% overnight currently sitting at $54.41 a barrel.
Current indicative rates:
NZDUSD 0.6891 0.7%
NZDEUR 0.5924 0.9%
NZDGBP 0.5183 0.6%
NZDJPY 77.67 -0.1%
NZDAUD 0.8972 0.4%
NZDCAD 0.8887 0.7%
GBPNZD 1.9294 -0.6%
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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