NZD consolidates break above 0.69

Key Movers

The positive mood sparked by peace talks between Ukraine and Russia has helped elevated the Euro through trade on Tuesday, while commentary for Japanese officials has helped arrest the Yen recent fall. Following peace talks in Istanbul Russia has announced it will scale back its military operations in and around Kyiv in a bid to create a level of mutual trust as Ukrainian negotiators agree sufficient progress has been made, allowing a meeting between President Zelensky and President Putin to take place. The positive outcome helped bolster European equities and allow the single currency to push back above 1.11. Having touched intraday highs at 1.1127 the currency has tracked lower into the open where it now buys 1.1085.

The Yen is also stronger, having recouped some of the weeks' earlier losses after MoF officials addressed the recent “undesirable” FX movements and the possible impact of the JPY correction on the economy. The open discussion of JPY performance has helped add support to the currency as BoJ policymakers face mounting pressure on their yield curve control policy. Having touched highs at 124.25 the Yen fought back forcing the USD back toward 122 before finding a middle ground to trade at 1.2285 on open this morning.

We anticipate volatility across currency markets will remain in play through the short term as our attentions remain on global rates, bond prices, commodities and the evolving Russia/Ukraine crisis.