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Dollar Regains Control as Stocks and Yield Rebound, Facing Key Levels Against Euro, Sterling and Franc

Dollar index jumped overnight and breached 96.98 key resistance, with the help from rebound in stocks and treasury yields. But strength of the greenback mainly centered against Sterling, Swiss Franc and Yen. It's holding in range against Euro, Canadian and Australian for the moment. As for today, Sterling is...

New Zealand ANZ business confidence rose to -37.1, next RBNZ move more likely a cut

New Zealand ANZ Business Confidence improved to -37.1 in October, up from -38.3. Confidence is weakest in agriculture (-62.8) and best in construction (-14.8). Activity Outlook index dropped -0.4 to 7.4. Manufacturing (16.2) is the strongest, possibly due to lower New Zealand Dollar exchange rate. Services ranks second (12.6)....

Australia & New Zealand Weekly: Looking through Monthly Volatility, Westpac’s Employment Outlook for Aus

Week beginning 29 October 2018 Looking through monthly volatility, Westpac's employment outlook for Australia RBA: Assistant Governor Bullock speaks. Australia: CPI, retail trade, import/export prices, trade balance, dwelling approvals. NZ: residential building consents, business confidence. China: NBS PMI's. Europe: GDP, employment, CPI. US: PCE inflation, Treasury refunding announcement, ECI,...

Sterling Jumps on Strong Wage Growth, But Upside Capped by Brexit Uncertainty

Sterling trades broadly higher today as boosted by stronger than expected wage growth data. While the gains are impressive, upside is limited against Dollar, Euro and Yen so far. UK Prime Minister Theresa May's fortunate in the EU summit tomorrow is a factor capping the Pound. Also, there will...

Pound Gains on Upbeat British Wages Before EU Summit

Here are the latest developments in global markets: FOREX: Growth in British average earnings (excluding bonuses) in August came in stronger than expected at 3.1% y/y versus forecasts of 2.9%, helping pound/dollar to rally as high as 1.3227 early in the European session before slipping back to 1.3219 (+0.51%). Employment declined, though, by 5k missing forecasts...

Into US session: Sterling strongest on wage growth, Kiwi follows on CPI

Inflation data is the dominant market drivers today. Entering into US session, Sterling is trading as the strongest one today on faster than expected wage growth data. The Pound also reversed all the earlier losses due to Brexit jitters and is now the second strongest for the week. New...

Kiwi Gains After Strong Inflation Numbers

The New Zealand dollar rose against the USD in the Asian session. This was after the New Zealand Bureau of Statistics released CPI numbers for the third quarter. During the quarter, the CPI rose at a QoQ rate of 0.9%, which was higher than the 0.7% that traders were...

New Zealand Dollar Jumps on CPI, Dollar Recovers after Brief Selloff

New Zealand Dollar rises sharply and broadly today as boosted by consumer inflation data. Other than that the forex markets are pretty directionless. Despite being sold off yesterday after retail sales, Dollar recovers broadly today as corrective trading continues. The greenback is in tie with Canadian Dollar as the...

New Zealand Dollar surges after CPI beat expectations, AUD/NZD dives

New Zealand CPI rose 0.9% qoq in Q3, and beat expectation of 0.7% qoq. Annual rate accelerated to 1.9% yoy, up from 1.5% yoy in Q2, and beat expectation of 1.7% yoy. StatsNZ noted that the 1.9% annual increase in CPI was mainly due to the housing and household...

New Zealand Inflation Awaited to Help Kiwi Extend Rebound

New Zealand inflation data for the third quarter will be made public at 2145 GMT on Monday, probably giving impetus to the Reserve Bank of New Zealand’s hopes that inflation will rise towards the midpoint of its target. The kiwi lost significant ground lately against the greenback, becoming the worst performer among G10 currencies during the...

Pound Bounces up as Geopolitics Weigh on Dollar; Gold Rallies to 3-Month Highs

Here are the latest developments in global markets: FOREX: After starting the day with a gap down at 1.3082, pound/dollar managed to turn positive during the early European session, rallying to 1.3170 (+0.12%) mainly due to a weaker dollar. Brexit uncertainties continued to linger in the background as the talks between...

Currency Manipulation In The US-Sino Trade War

In an interview on Thursday, US Treasury Secretary Mnuchin stated that the US wants to make sure that Yuan’s recent depreciation isn’t a competitive devaluation. According to media, info leaked that US treasury department staff will not be categorizing China’s Yuan, as a manipulated currency. IMF states that the...

NZD/USD Bearish Channel in Force, NZ CPI on Tap

Risk assets saw a respite from the relentless selling pressure in overnight trade as US stock market futures turned higher, but that rally may prove to be short-lived. After opening higher by nearly 400 points from yesterday’s close, the Dow Jones Industrial Average just dipped back into negative territory as...

All Eyes on China GDP Amid Equities Rout; Crunch Time for Brexit Talks

As rising US yields and ongoing trade tensions fuel concerns about the global growth outlook, GDP numbers out of China will be the main highlight of the coming week. There will be plenty of other important data too as attention turns to monthly jobs, inflation and retail sales figures,...

Australia & New Zealand Weekly: Credit Spreads and Monetary Policy Cycles

Week beginning 15 October 2018 Credit spreads and monetary policy cycles. RBA: minutes, RBA Deputy Governor Debelle speaks. Australia: Westpac-MI Leading Index, employment, NZ: CPI. China: GDP, new loans. Europe: EU Summit. US: FOMC meeting minutes, retail sales. Other central banks: BoK policy decision, BoE Carney speaks, BOJ Kuroda...

IMF downgrades 2019 Asia growth forecasts, including Australia, Hong Kong, Korea, Singapore, China, India

In the regional outlook report released today, IMF downgraded Asia growth forecasts in 2019 due to financial market stress and trade tensions. But it maintained that "near-term outlook for Asia remains positive, supported by steady global momentum and broadly accommodative policies". Also, "Asia continues to be the main growth...

Where To Ride Out The Volatility

We look at the causes of the latest round of fear and volatility and where to ride out the storm. Stock markets were hammered again Thursday but it was the New Zealand dollar that led the way in a sign of shifting correlations. China trade balance is due up...

IMF Lowers Global Economic Forecast For 2018

The International Monetary Fund (IMF) lowered the global economic forecast to 3.7% from the previous 3.9%. The organization said that the current trade rhetoric coupled with the disruption of capital flows to the emerging markets will curtail growth. In recent months, the United States and China have engaged in...

Australia & New Zealand Weekly: Big Fall in AUD is Behind Us

Week beginning 8 October 2018 Big fall in AUD is behind us. RBA: Financial Stability Review, Assistant Governor (Economic) Ellis speaks. Australia: Westpac-MI Consumer Sentiment, housing finance, NAB business survey. NZ: retail card spending, house sales and prices. China: new loans and financing, trade balance. Europe: Sentix investor confidence. ...

US Dollar Falls Ahead Of Key Employment Numbers

The Australian dollar declined slightly after building approval numbers were released. The numbers from the Australian Bureau of Statistics (ABS) showed that approvals declined by 9.4 percent on a month-on-month basis. This was the biggest decline this year and was mostly because of a 17.2% decline in private dwellings....

Weekly Economic and Financial Commentary: Central Banks in Focus as Growth Remains Steady

U.S. Review Fed Rate Hike Took Center Stage This Week The Federal Open Market Committee (FOMC) raised the fed funds rate 25 bps this week in a widely-expected move. The removal of language characterizing monetary policy as "accommodative" in its statement signals that FOMC members recognize that the funds rate...

Dollar Extends Post FOMC Broad Based Rally, Euro Lower on Italy Budget Jitter

Dollar strengthens further and broadly, in early US session as post FOMC rally extends. As we aruged in prior report, there were hawkish elements in Fed's projections and overall announcement should be Dollar positive. Today's rally showed that this view is shared by other participants. In particular, EUR/USD's break...

USD Gans As Fed Points To More Tightening

The Federal Open Markets Commission (FOMC) raised interest rates by a quarter percentage point to 2 – 2.25%. This was the third rate hike this year and the eighth in the tightening cycle that started in 2015. The committee said that it remained supportive of more rate hikes despite...

Investors Assess The Results Of The Fed Meeting

The US currency strengthened against the basket of major currencies after the Fed meeting. As it became known, the regulator increased the range of the key interest rate by 25 basis points to 2.00%-2.25%, as investors expected. Yesterday, the US dollar index (#DX) closed in the positive zone (+0.06%)...

Dollar Rebounded from Knee-Jerk Selloff as Fed is More Hawkish than Initial Perceived

Dollar suffered a brief knee-jerk selloff after Fed raised interest rate as widely expected but stopped calling monetary policy as accommodative. But the greenback recovered as the overall announcement wasn't dovish at all. There were indeed more hawkish elements in the details of the new economic projections. For now,...

NZD/USD range bound after non-eventful RBNZ rate decision

NZD/USD trades steadily in range after RBNZ kept OCR unchanged at 1.75% as widely expected and delivered no surprise to the markets. Governor Adrian Orr reiterated in the statement that "we expect to keep the OCR at this level through 2019 and into 2020." He also kept the options...

RBNZ kept OCR unchanged at 1.75%, full statement

OCR unchanged at 1.75 percent Statement by Reserve Bank Governor Adrian Orr: The Official Cash Rate (OCR) remains at 1.75 percent. We expect to keep the OCR at this level through 2019 and into 2020. The direction of our next OCR move could be up or down. Employment is around its sustainable level...

Dollar Spikes Above 113 Versus Yen Ahead Of FOMC Decision, Kiwi Awaits RBNZ Rate Announcement Too

Here are the latest developments in global markets: FOREX: Major currencies were trading in narrow ranges as traders were waiting for the FOMC policymakers to conclude their two-day policy meeting later on Wednesday with another rate hike on the cards. But more importantly they are interested to learn what are...

Look To Fed’s Powell For Help

Wednesday September 26: Five things the markets are talking about Global stocks are trading mixed ahead of today's FOMC rate decision, with Asian shares closing out higher, while Euro bourses are a tad down as Italy's budget talks continue to be a source of concern. The Italian government has until tomorrow...

Dollar Consolidates Ahead Of Fed, Rate Guidance To Drive The Currency

Here are the latest developments in global markets: FOREX: The dollar index is practically unchanged on Wednesday (+0.02%), ahead of the Fed decision later today (1800 GMT), where a quarter-point rate increase is seen as a done-deal. The pound moved higher, outperforming its peers amid signs that the EU is...