The overnight trading session was a tale of two halves. PMI readings showed French and German economic activity declined in September. Shares fell and the Euro weakened. However US PMIs showed manufacturing accelerated over the same period, stabilising sentiment and lifting stock indices and industrial metals back to square.

Asia Pacific investors have little to go on this morning. The ongoing pressure on the Euro and the safe haven Yen is lifting the US Dollar by default. Share futures are still slightly in the red, but up from overnight lows. The next cab off the PMI rank is Japan as it returns from yesterday’s holiday.

The Reserve Bank of New Zealand meets tomorrow. Interest rate markets are reflecting just a 15% chance of a reduction in rates after last month’s 0.5% slashing. Both the Australian and New Zealand dollars are at decade lows against the US. Any hints of further interest rate reductions or commodity price falls could push the local currencies into territory not seen since the GFC.