The NZD opens at 0.6872
It was quite the day across the board yesterday. The Fed holding rates steady and the dovish FOMC statement saw a
selloff in the USD early yesterday morning. It was actually a fairly solid move of circa 1%, which was relatively
surprising given how the statement was expected to be relatively dovish.
NZ GDP came in as officially expected at 0.6%. There were fears that GDP could come out weaker, so the market reacted
positively to the on-the-money figure. Since then however the NZD has retraced most of its move, getting us virtually
back to where we started. Given the recent consolidation in rates, it looks like the technical picture exacerbated the
move somewhat.
The Australian Unemployment rate came in lower than expected at 4.9% which helped the AUD across the board, but drilling
down into the data, the overall figures were not as strong as the headline, and the AUD has also retraced back.
The EU are discussing an extension to Brexit, though there is no current consensus on what exact date it would get
extended to. The EU are posturing that they will only give an extension if May can get the deal approved through
Parliament. They are wary of giving an extension for the sake of it, and ending up in the same position in 2 months’
time. To my mind, if they rejected the extension, that would force the UK Parliament to finally make a decision, and if
they truly believed the decision was between a deal and no deal, one would think the deal would pass. The odds of
something so decisive being forced however, seems small. The BOE kept interest rates on hold at 0.75%, but until Brexit
is sorted, this is really not a focus of the market at all.
A fair bit of manufacturing data out of Europe from 21:15 tonight will drive direction for the EUR.
Global equity markets are generally up, - Dow +0.94%, S 500 +1.15%, FTSE 0.88%, DAX -0.46%, CAC -0.07%, Nikkei +0.20%, Shanghai +0.35%.
Gold prices are up 0.5% trading at $1,308 an ounce. WTI Crude Oil prices are also higher overnight, up 0.8% trading at
$60.17 a barrel.
ends