By Dan Bell
The NZDUSD opens at 0.6668 (mid-rate) this morning.
Markets remain in a holding pattern with investors remaining on the side lines amid uncertainty about the outcome of today’s US midterm elections.
Earlier this morning the latest GDT auction resulted in another fall, with the overall index down 2.0% from the previous auction a fortnight ago. Volumes increased by 1.1% with a total of 42,412 tonnes selling under the hammer for an average selling price of $2,851 per tonne.
There has been little reaction to yesterday’s RBA monetary policy statement where the RBA as widely expected voted to keep the OCR unchanged at 1.50%.
The Central Bank noted that the economy was performing well with the GDP growing by 3.4% and the unemployment rate declining to 5.0% over the past year. Policymakers also upwardly revised their economic growth forecasts for 2018 and 2019 to 3.5% and expect unemployment to fall further and inflation to increase, but noted that this progress is likely to be gradual.
The key domestic driver for the NZD today will be this morning’s quarterly employment report with current forecasts predicting an increase in employment and the labour cost index of 0.5% with unemployment expected to dip to 4.4% from 4.5% in Q2.
Midterm election results are expected to start flowing through this afternoon with the polls still showing the Democrats have the necessary 23 seat swing to turn the lower house while the Republicans are expected to retain the Senate majority.
Global equity markets remain mixed, – Dow +0.47%, S&P 500 +0.39%, FTSE -0.89%, DAX -0.09%, CAC -0.51%, Nikkei +1.14%, Shanghai -0.23%.
Gold prices are edging lower, down 0.3% trading at $1,226 an ounce. WTI Crude Oil have fallen sharply, down 2.7% trading at $61.72 a barrel.
Current indicative rates:
Upcoming Data releases (NZST):
To subscribe to our free daily Currency Rate Sheet and News email, enter your email address here.
Dan Bell is the senior currency strategist at xe money transfer in Auckland. You can contact him here »