The commodity currencies skyrocketed today with the Australian dollar hitting a fresh 18 year high, the New Zealand dollar reaching a new 25 year high and the Canadian dollar on its way back to testing its 30 year high.
Both gold and oil prices are up strongly as well. A refinery shutdown in the US caused a sharp intraday reversal in crude and the move was exacerbated by the lack of market liquidity because Canadian markets were closed today. Demand for high yielding currencies continue to be voracious and we do not expect it to be curbed anytime soon. However, be especially careful of intervention by the Reserve Bank of New Zealand around current levels. In fact, they may even take the opportunity to intervene when US markets are closed on July 4th, so they can get the best bang for their buck. Australia reported softer manufacturing PMI, but that was offset by stronger inflation data. Retail sales are due for release tonight. Low employment should boost spending in the month of May.