By Dan Bell
The NZDUSD opens at 0.6668 (mid-rate) this morning.
The NZD is consolidating its recent spike and is the strongest performing of the G10 currencies over the past 24hrs.
Markets have traded in an orderly fashion as investors look to the US midterm election results before adding to their positions. An ABC News poll released yesterday showed 50% of registered voters are in favour of a Democratic House, compared with 43% in favour of a Republican house. The Democrats need to gain 23 seats to retake the House and 2 seats to reclaim a Senate majority.
Overnight the US Institute for Supply Management reported a smaller than expected slowdown in the pace of growth in US service sector activity during the month of October. The report showed its non-manufacturing index edged down to 60.3 in October following a record high reading of 61.6 in September. The index had been expected to pull back to 59.3. The ISM also reported falls in both the price index and the employment index during October, with the price index falling to 61.7 from 64.2 and the employment index slipping to 59.7 from 62.4.
The British pound weakened overnight after the UK service sector recorded its slowest rate of expansion since March and its second lowest reading since July 2016. The IHS Markit Purchasing Managers’ Index recorded a reading of 52.2 in October following a September reading of 53.9 and below the forecast 53.4 result.
This afternoon the RBA are expected to keep their OCR unchanged at a record low of 1.5% with investors looking to the tone of the accompanying statement for direction.
Global equity markets are mixed, – Dow +0.48%, S&P 500 +0.26%, FTSE +0.14%, DAX -0.21%, CAC -0.01%, Nikkei -1.56%, Shanghai +0.41%.
Gold prices are little changed trading at $1,230 an ounce. WTI Crude Oil have prices are up 0.9%, trading at $63.43 a barrel.
Current indicative rates:
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Dan Bell is the senior currency strategist at xe money transfer in Auckland. You can contact him here »