Daily Market Commentary 30th November 2021

The new virus variant, named the ‘Omicron’, panicked markets last Friday into a massive sell-off in equities. US Bond yields collapsed, after recent strong gains, while the US Dollar declined. The absolute panic ceasing markets on Friday was media hype and a strong recovery ensued, when markets reopened for the new week. The Dallas Fed Manufacturing Index was lower and US Pending Homes Sales contracted, while inflation and growth challenges remain. The GBP slipped back below 1.3300, while the EUR fell to 1.1250, as the US Dollar recovered some lost ground. German CPI data was higher than expected, coming in at an annualised rate of 5.2%, with rising energy costs, raw materials and supply chain issues all driving the inflationary pressures.

The rebound in the reserve pushed the NZD back to 0.6800, while the AUD may once again test 0.7100, on the downside. Global threats of a resurgent virus impacts global commodity demand, which in turn hits the associated currencies. NZ Business Confidence will be released today, while markets will be closely watching US employment data this week, culminating in the all-important Non Farm Payrolls released Friday.