XE Morning Update - June 27, 2019

The NZDUSD opens higher at 0.6676 this morning.

The NZD gained across the board yesterday after the RBNZ left the Official Cash Rate on hold at 1.50%, despite stating the further interest rate cuts are likely. They highlighted downside risks to the inflation target and sustainable employment and it certainly appears the RBNZ will be in a position to lower the OCR at its next meeting on 8th August.

Overnight, the NZDUSD traded to 2-month high of 0.6690, the NZDAUD touched 0.9575 – a level last seen 3rd April, while the NZDGBP hit 0.5275 – a 3-month high. The NZDEUR, NZDJPY, & NZDCAD all traded to 2-week peaks.

The global markets are now focusing on the G-20 meeting this week, with emphasis on the side meeting between the US and China in the hope they can make headway in resolving their trade dispute. Adding a little spice was President Trump when he once again threatened substantial addition tariffs if a deal can’t be reached.

The GBP weakened after Boris Johnson, the top pick to be the next British Prime Minister, reaffirmed his desire to take the UK out of the EUR with or without a deal by the current 31 October deadline.

ANZ Business Confidence will be released at 1pm.

Global equity markets were generally little changed on the day - Dow +0.1%, S&P 500 0.0%, FTSE -0.1%, DAX +0.1%, CAC -0.3%, Nikkei -0.5%, Shanghai -0.2%.

Gold prices dropped 0.9% to USD$1,410. WTI Crude Oil prices jumped 2.5% to US$59.22 per barrel, buoyed by an outage at a major US refinery and industry data that showed crude inventories were at lower levels than forecast.

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