The NZDUSD opens at 0.7366 (Pre FOMC) this morning.
With the FOMC statement and federal funds rate decision out at 8:00 am NZT, you can expect the market to have moved from where we are currently sitting. Whilst no one is really expecting any actual hike till March, (75% chance of a hike then), it will be Yellen’s last statement that the market will be watching closely for any clues that might change the future odds.
Yesterday we had Trump's first State of the Union address, which apart from the announcement of they had “ended the war on beautiful, clean coal”, didn’t really bring out any market moving headlines. He did reiterate how well the economy was doing though, which was back up by solid employment numbers, with 234k Non-Farm jobs added.
Out of Europe, CPI Flash estimates came bang on expectations.
Apart from the big new at 08:00 this morning, there is not much data out, so expect the statement to drive momentum throughout the trading day as various financial centres come online.
Global equity markets were mixed, with the US halting their decline – Dow 0.55%, S&P500 0.25%, FTSE -0.68%, DAX -0.06%, CAC 0.15%, Nikkei -0.83%, Shanghai -0.21%.
Gold prices rose 0.7% to USD$1,339 an ounce. Oil prices (WTI) were flat at USD$64.36 per barrel.
Current indicative rates:
| NZDUSD | 0.7366 | 0.5% |
| NZDEUR | 0.5933 | 0.3% |
| NZDGBP | 0.5192 | 0.2% |
| NZDJPY | 80.53 | 1.0% |
| NZDAUD | 0.9145 | 0.8% |
| NZDCAD | 0.9072 | 0.4% |
| GBPNZD | 1.9254 | -0.2% |
Upcoming Data releases (NZST):
- 08:00 FOMC Statement, Federal Funds Rate
- 22:30 UK Manufacturing PMI
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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »
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