Kiwi teeters but holds

Today's close in NZD/USD is on track for the lowest since April 12. The good news is that the May intraday low has held. If it breaks, there isn't much support until 0.7040.

On the week, NZD is easily the weakest G10 performer. Some of that reflects a broad USD bid and we've seen similar price action in EM currencies.

More and more, the positioning is starting to look like a classic ‘risk off' trade, especially with yields falling. So far, that hasn't spilled over into equities but the warning signs are there.

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