HiFX Morning Update, March 9 2018

HiFX Morning Update, March 9 2018

The NZDUSD opens lower at 0.7255 this morning.

The EUR fell, and USD strengthened, after European Central Bank President Mario Draghi indicated that any monetary policy normalisation would be very gradual as regional inflation remained subdued, despite faster euro-zone growth. These factors weighed on the NZDUSD.

Draghi was critical of President Trump’s plans to impose tariffs on some imported goods. However, the White House announced late Wednesday that Canada, Mexico and possibly other countries may be granted exemptions.

Tariffs and any potential trade war/retaliation concerns will continue to be a market focus. Any noticable increase in impediments to free trade would be a negative for the NZD, due to its leverage to commodity prices and global growth.

The all-important US non-farm payroll employment figures, a key measure of the U.S. economy, will be released overnight. These numbers will be closely analysed for further clues on the pace of U.S. interest rate hikes.

There is no data on the domestic calendar today.

Global equity markets were higher on the day – Dow -0.3%, S&P500 -0.1%, FTSE +0.6%, DAX +0.8%, CAC +1.3%, Nikkei +0.5%, Shanghai +0.5%.

Gold prices fell 0.4% to USD$1,321 an ounce. Oil prices (WTI) dropped -0.6% to USD$60.46 per barrel.

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