Daily Market Commentary 28th February 2024

US equity markets turned south overnight ahead of key inflation numbers set to be released later in the week. Durable Goods Orders contracted sharply, by 6.1%, while the Dallas Fed and Richmond Fed Manufacturing Index also remained negative. German and French Consumer Confidence operate in the doldrums, as these major European economies, suffer recessionary economic conditions. Bond Yields remain elevated, as the EUR drifted back below 1.0850 and the GBP looks to regain 1.2700.

The reserve was relatively static, allowing commodity currencies to meander. The AUD traded just below 0.6550, while the NZD was holding around 0.6150, ahead of today’s RBNZ interest rate decision. The RBNZ is expected to leave rates unchanged, so markets will focus keenly on the narrative. A hawkish tone will support the currency, but any talk of interest rate cuts, will have downside consequences.