The Opening Bell: Where currencies start on Friday, January 26, 2018

The Opening Bell: Where currencies start on Friday, January 26, 2018

By Dan Bell

The NZDUSD opens down at 0.7376 (mid-rate) this morning.

The main driver for the Kiwi yesterday was poor inflation data. CPI came in well below expectations at 0.1% q/q, well less than the 0.4% expected. This saw a sharp drop in the NZD of about 1% across the board. Against the USD especially though, the support held, and for now at least the inexorable uptrend continues.

Off to Europe, the Minimum bid rate was held steady at 0.00% as expected. Draghi reiterated his usual comments, but did say that the data confirmed a “Robust pace of Economic Expansion” which lead to some strength. He gave us the rare insight that “Volatility creates uncertainty”.

As I type we have news out from Trump on CNBC, stating that ultimately he wants a strong dollar. Whilst this may be slightly contradictory to his hopes to increase exports, the USD is actually reacting, popping about half a percent against most of its rivals.

Australia is off celebrating Australia day today, so we can expect lighter volumes from there than usual. New Zealand will follow suit on Monday, with Auckland off. We will still be in as per usual, just expect NZD settlements to be delayed.

Global equity markets are quite mixed - Dow +0.66%, S&P 500 0.23%, FTSE -0.36%, DAX -0.87%, CAC -0.25%, Nikkei -1.13%, Shanghai -0.31%.

Gold prices are up 0.8% trading at $1364 an ounce. WTI Crude Oil prices have been driven higher, currently up 2% trading at $65.94 a barrel.

Current indicative rates:

NZDUSD 0.7376 -0.7%
NZDEUR  0.5899 -1.4%
NZDGBP 0.5170 -1.0%
NZDJPY 80.08 -1.1%
NZDAUD 0.9117 -0.9%
NZDCAD 0.9086 -0.8%
GBPNZD 1.9345 1.0%

Upcoming Data releases (NZST):

  • 22:30 - UK Prelim GDP
  • 02:30 - Canadian CPI
  • 02:30 - US Advance GDP, Core Durable goods

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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »

Daily exchange rates

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USD 
NZD
End of day UTC
Source: CoinDesk

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