HiFX Morning Update, October 25 2016

HiFX Morning Update, October 25 2016

NZDUSD 0.7132 -1.0%
NZDEUR 0.6553 -0.5%
NZDGBP 0.5834 -0.7%
NZDJPY 74.25 -0.8%
NZDAUD 0.9382 -0.6%
NZDCAD 0.9539 0.3%

The NZDUSD opens at 0.7132 (mid-rate) this morning.

Broad USD strength has helped push the NZDUSD back into the low 71 cent region. The USD has continued to rally as investors position their books for a December US rate hike. Markets have so far priced in a 67% chance of the Fed raising the interest rates in December.

This morning’s US Flash Manufacturing Purchasing Managers’ Index exceeded economists estimates rebounding to 53.2 in October, from a three-month low of 51.5 in September. The number was well above the forecast 51.6 result and the rate of improvement was the fasted since October 2015.

The pace of economic growth in the Euro-zone for the month of October rose to its highest level this year. With Germany leading the way, the Composite Output Index, Services PMI Activity Index, Manufacturing PMI Output Index, and Manufacturing PMI all printed ahead of expectations.

The week ahead offers little in the way of domestic data releases with Thursday’s trade balance the only noticeable announcement.

Global equity markets with the FTSE the only exception are edging higher - Dow +0.41%, S&P 500 +0.38%, FTSE -0.49%, DAX Closed CAC +0.27%, Nikkei +0.29%, Shanghai +1.42%.

Gold prices are little changed, currently trading at $1,263 an ounce, WTI Crude Oil which gained 2.2% on Friday is currently down 1.6% at $50.62 a barrel.

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