HiFX morning Update, December 20, 2018

NZDUSD 0.6845 -0.1%
NZDEUR 0.5987 -0.6%
NZDGBP 0.5408 -0.1%
NZDJPY 76.75 -0.5%
NZDAUD 0.9555 0.0%
NZDCAD 0.9203 -0.3%
GBPNZD 1.8491 0.1%

The eagerly awaited FOMC statement will be released at 08:00am with a press conference to follow at 08:30.

The market is currently pricing in a 75% chance that the Fed will hike rates by 0.25% at this morning’s meeting with many economists believing the Fed will downwardly revise its 2019 forecasts from three further hikes to two.

US equity markets have added to yesterday’s gains as investors positon their portfolios in anticipation of a dovish statement.

This morning’s third quarter Gross Domestic Product report is expected to follow Australia and show a slowing economy. Following on from Q2 where the NZ economy expanded by 1.0% this morning market consensus is for Q3 growth to slow to 0.6% q/q while annualised growth is expected to remain at 2.8%.

Global equity markets remain mixed, Dow +1.28%, S&P 500 +1.12%, FTSE +0.96%, DAX +0.24%, CAC +0.49%, Nikkei -0.60%, Shanghai -1.05%.

Gold prices have inched higher up 0.4% trading at $1,253 an ounce. WTI Crude Oil prices have bounced off yesterday’s lows, up 0.8% trading at $48.05 a barrel.

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