HiFX Morning Update - June 12

HiFX Morning Update - June 12

The NZDUSD opens at 0.7015 (mid-rate) this morning.

The Reserve Bank of NZ cut the Official Cash Rate by 25 basis points to 3.25% yesterday morning. The NZD is substantially lower this morning as a result.

Later in the day the Australian Labour Force numbers for May came in much stronger than expected yesterday afternoon. Full time employment increased by 14,700, and the unemployment was lower to 6.0%. The NZDAUD opens up 2.6% lower this morning.

The USD is up modestly against both the Euro and Japanese Yen overnight, but nearly unchanged against the pound sterling. The Retail Sales posted a strong number – 1.2% in May, however Initial Jobless Claims were only up 2,000 from the previous week’s revised level to 279,000. Economists had expected jobless claims to edge down.

The International Monetary Fund announced that it has withdrawn from discussions with Greece. The IMF has departed Brussels after stating that "no progress" was being made toward an agreement. S&P Ratings Services cut its long-term sovereign credit rating on Greece to 'CCC' from 'CCC+', citing the likelihood of the nation defaulting on its commercial debt within the next 12 months in the absence of a bailout deal with its official creditors.

Overnight data releases that could have a high impact are the US Producer Price Index and US University of Michigan Consumer Confidence.

Global equity markets are moderately higher: Dow +0.34%, S&P 500 +0.27%, Nikkei +1.68%, Shanghai +0.30%, FTSE +0.24%, DAX +0.60%, CAC +0.74%

Gold prices are down $4 trading at $1182 an ounce, Oil (WTI) is up 0.3% at $61.43 a barrel.

The current indicative mid-rates are:

NZDUSD 0.7015
NZDEUR 0.6220
NZDGBP 0.4513
NZDJPY 86.50
NZDAUD 0.9035
NZDCAD 0.8605

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