The NZD was the best performing major against the USDlast night, though to be honest, it did not take much. NZD/USD is just 0.2% higher at 0.8380.Yesterday, the Q2 terms of trade data managed to turn afew heads. Defying every economist polled, the terms oftrade actually rose on a quarterly basis, up 0.3% q/q (vs -3.5% expected). While the headline reads positively, itactually hides negative undertones. For one thing, whileexports fell (as broadly expected), import prices fell faster,which is disinflationary. Second, the fall in export volumes(-5.3%) was on the hefty side of estimates, and puts adownside bias on Q2 GDP growth. But in a sleepy tradingsession, the NZD hardly budged.
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