Global Themes

NZD bounces back as ECB steps back
The NZDUSD moved back towards the highs overnight as central bank commentary continued to drive markets.
Wednesday night’s speech from European Central Bank president Mario Draghi caused markets – and the kiwi – to fall as the ECB head signalled the central bank is upbeat on European growth.
However, as the key ECB forum in Sintra, Portugal continued, ECB staff members indicated that the market had “over-reacted” to Draghi’s speech.
The reversal saw the NZDUSD up 0.5% as it neared this week’s four-month highs.

Euro holds
The ECB’s shift didn’t impact on the euro with the European currency continuing to climb.
The NZDEUR was broadly steady after earlier trading at three-week lows.
The kiwi was lower versus the Australian dollar as it fell to one-week lows.
The NZD also fell versus the British pound but was stronger against the Japanese yen.

Today’s local focus is on business confidence figures due at 1.00pm.
Tonight, the European focus will be on German and Spanish inflation numbers.
From the US, the final read for March-quarter GDP will be the big result.

By Steven Dooley -- Currency Strategist APAC

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