HiFX Morning Update

The NZDUSD opens at 0.6980 (mid-rate) this morning.

The USD is little changed against its major competitors overnight. Investors are playing it cautious ahead of Wednesday's announcement from the U.S. Federal Reserve. The Fed will conclude its 2-day monetary policy meeting tomorrow morning around 6am.

The Fed is not expected to announce an increase in interest rates due to some recent signs of economic sluggishness, but traders will be paying close attention to any hints regarding the timing of thefirst rate hike which is likely to be September.

US Housing Starts were down 11.1% in May after surging 22.1% in April. Building Permits, an indicator of future housing demand, leapt 11.8% in May. The increase in building permits came as a surprise to economists, who had expected permits to drop.

Greece remains at an impasse with its international creditors and the inability of the two sides to reach a compromise has led to worries about a potential Greek default at the end of the month. German Chancellor Angela Merkel stated overnight that she is hoping for a Greek deal by Friday.

A meeting of the European finance ministers will be held in Luxembourg on Friday. "I have repeatedly said that I want to do everything possible to keep Greece in the Eurozone. I devote myself to this task these days," Merkel stated.

A bond-buying programme announced by the European Central Bank in 2012, which helped to calm the financial markets amid the peak of the sovereign debt crisis, was upheld by the top EU court overnight, further strengthening ECB President Mario Draghi's crisis-fighting efforts.

US equity markets are moderately higher while (with the exception of the German DAX & UK’s FTSE) European and Asian equity markets were sharply lower: Dow +0.64%, S&P 500 +0.57%, FTSE -0.01%, DAX +0.54%, CAC -1.25%, Nikkei -0.64%, Shanghai -3.47%, Hang Seng -1.11%,

Gold price is down $5 trading at $1181 an ounce, Oil (WTI) is down at $59.52 a barrel.

The current indicative mid-rates are:

NZDUSD 0.6980 - 0.2%
NZDEUR 0.6210 +0.3%
NZDGBP 0.4465 -0.3%
NZDJPY 86.15 -0.1%
NZDAUD 0.9020 +0.2%
NZDCAD 0.8600 -0.2%

Domestic data releases today:
10:45am Current Account

ENDS

© Scoop Media