Rising global tensions kept markets in check yesterday with the Kiwi Dollar trading a narrow range overnight. Stock markets are flat, gold and oil prices have risen, while safe haven currencies continue to be well supported with the Japanese Yen reaching a 3 month high vs the USD.
Risk Appetite Falls
Global risk appetite continues to come under pressure as markets are in wait-and-see mode on the next U.S – Iran move. The US Dollar has remained under pressure with tensions escalating as President Trump said the US had identified 52 Iranian sites it would hit if Iran retaliates.
Sterling Firmer on Positive Business Surveys
A weaker US Dollar and better than expected PMI data saw the Pound make back some of its recent losses overnight. General optimism among UK companies has improved markedly since the December 12 election win for the Conservatives. However this optimism has not yet been reflected in recent economic data with markets remaining cautious.
The Day Ahead
Nothing of note on the local front today, but there will be interest in the first global dairy auction of the year overnight. Further afield the first batch of US data for the week is released tonight with Factory Orders and ISM non-manufacturing PMI being the main items.
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