HiFX morning Update, September 10 2018

The NZDUSD opens at 0.6535 (mid-rate) this morning.

The USD along with the GBP both outperformed on Friday with better-than-expected wage growth and employment data boosting the USD while the British Pound is trading higher after the EU's chief Brexit negotiator Michel Barnier indicated that both parties are close to agreeing an Irish border backstop solution.

Although the US Labour Department reported non-farm payroll employment increased by 201k jobs in August, 10k more than forecast, a 10k downward revision to July’s previously reported 157k increase levelled the playing field. Unemployment remained unchanged at 3.9% with investors focusing on the surge in average hourly earnings, which spiked 2.9% from a year ago. The result represents the biggest increase in wage growth since June 2009 and increases expectations that the US will hike rates later this month.

The British Pound received a boost after Michel Barnier said he is open to "other backstops" for the Irish border question, The Irish border question has been a major sticking point for negotiators and Mr Barnier’s comments suggest that the EU might be willing to defer this piece of the puzzle beyond the October deadline. The EU is looking for Northern Ireland to remain in the EU once the rest of the UK leaves and adopts their own independent customs policies, but the UK refuse to consider a border between Northern Ireland and Great Britain.

The NZD along with other emerging market currencies are likely to remain under pressure amid ongoing trade concerns, after President Donald Trump suggested he may impose tariffs on another $267b worth of Chinese goods, on top of the 200b he is currently contemplating imposing on Chinese goods following the expiration of a public comment period at the end of last week.

European equity markets closed out the week mixed, - Dow -0.31%, S&P 500 -0.22%, FTSE -0.56%, DAX +0.04%, CAC +0.16%, Nikkei -0.80%, Shanghai +0.40%.

Gold prices were unchanged on Friday closing out the week at $1,195 an ounce. WTI Crude Oil prices edged lower Friday, down 0.4% to close out the week at $67.55 a barrel.

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