The NZD/USD sits a little lower, at 0.8750, this morning. Yesterday’s release of the ANZ business survey for Juneshowed business confidence falling to 42.8 from 53.5previously. The ‘own activity’ indicator slipped to 45.8, 12.4points below its February peak. The level of this index isstill consistent with GDP growth of around 5.0% (above ourown peak pick of 4.3%). However, as we anticipated thecurrency responded to the loss of momentum rather thanthe outright level of the index. The NZD/USD slipped fromabove 0.8780 to evening lows below 0.8730. It hassubsequently clawed its way back to trade at 0.8750 thismorning, assisted by broad USD weakness overnight.
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