The NZDUSD opens at 0.6931 (mid-rate) this morning.
Following 7 consecutive falls, this morning’s Global Dairy Trade (GDT) finally resulted in an increase in dairy prices.
A total of 36,450MT of product was sold at this morning’s auction, with whole milk powder prices increasing by 2.5% to US$ 2,667 MT. Butter milk powder was the standout performer with prices rising 16.9%, while skimmed milk powder prices inched up 0.3%.
The improvement in market sentiment hasn’t lasted long with global equity markets and bond yields both falling overnight. The Dow is currently down 700pts with investors sceptical about the trade ceasefire, following President trump’s latest twitter comments. Trump said that he would "happily" sign a fair deal with China but has not ruled out the possibility that the talks will fail. "President Xi and I want this deal to happen, and it probably will," Trump tweeted. "But if not remember... I am a Tariff Man."
The gap between the US-two-year and 10-year yields has decreased to less than 0.12 percentage points, the lowest it has been since before the financial crisis. An inversion in the yield curve has in the past preceded a recession so investors will be monitoring this closely.
Bank of England Governor Mark Carney when questioned by lawmakers over comments he made last week on the effects that a disorderly Brexit would have on the UK economy, defended the bank’s position saying that they were looking at a worst case scenario. The central Bank predicted that the economy could shrink as much as 8%, House prices could fall 30% inflation could hit 6.5% and the pound could all 25% in the event of a no-deal Brexit.
Global equity markets are broadly lower, - Dow -2.72%, S&P 500 -2.75%, FTSE -0.56%, DAX -1.14%, CAC -0.82%, Nikkei -2.39%, Shanghai +00.42%.
Gold prices are marginally higher, up 0.2% trading at $1,236 an ounce. WTI Crude Oil prices are pushing higher, currently up 1.3% trading at $53.36 a barrel.