The NZD was sent sharply lower overnight on broader USDstrength, as well as another dismal dairyauction. NZD/USD is 0.6% weaker at 0.8470.Dairy prices fell a further 0.8% in the latestGlobalDairyTrade auction, taking the cumulative declinesince early February to an eye-watering 41%. With theNZD’s fall having been (much!) more modest to date,Fonterra’s fresh 2014/15 payout forecast of $6.00 looksoptimistic at this point. Current prices and the level of theNZD would suggest a milk price in the mid-$5 area.
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