The Opening Bell: Where currencies start on Thursday, March 7, 2019

The NZDUSD was dragged lower yesterday by the AUD after very weak Australian Q4 GDP figures hit the wires, stoking speculation the RBA will eventually be forced to cut interest rates.

Aussie GDP came in at +0.2% for the quarter and 2.3% on the year, missing an already reduced forecasts of +0.3%/+2.6% respectively. The AUD was sold aggressively in response, and this selling spilled over into the NZDUSD, which fell to a 0.6756 low, while the NZDAUD, in turn, jumped to an overnight high of 0.9650.

In a blow to President Donald Trump, overnight reports showed the US trade deficit widened to a 10-year high and private companies added fewer jobs than analysts forecast last month. President Trump will be feeling the pressure to cut a trade deal with China to help the US export sector. The key US non-farm payroll employment figures will be released Friday night.

Weak data from the euro zone the past few weeks has fuelled expectations that the ECB at tonight’s meeting could downgrade the zone’s growth and inflation forecasts for 2019 and hold off raising interest rates.

The Organisation for Economic Co-Operation & Development (OECD) cut forecasts again for global growth in 2019 and 2020, citing trade rows and Brexit uncertainty.

Brexit negotiations between the UK and EU made no headway overnight and no swift solution is in sight.