XE Morning Update - October 4, 2019

NZDUSD 0.6303 0.5%
NZDEUR 0.5741 0.4%
NZDGBP 0.5101 0.1%
NZDJPY 67.36 0.3%
NZDAUD 0.9346 0.0%
NZDCAD 0.8398 0.6%
GBPNZD 1.9606 -0.1%

The NZD opens at 0.6303

The Kiwi is up on the day, or more accurately, the USD is down. We had the ISM Non-Manufacturing PMI data overnight. While still being considered expansionary at 52.6, this was well below economists expectations of 55.1, and the trend is not looking good. All this has led to market pricing for another rate cut out of the Fed on October the 30th, to increase from 60% last week to 92% today. To really get a strong move we will need NZ data to start diverging and beating expectations.

Closer to home we have AU Retail sales at 2:30 this afternoon. Last month’s figures were disappointing, so a rebound would help placate the markets.

The UK Brexit drama continues, with apathy being the net result. Be careful though, October 31st is quickly approaching. It can be hard to predict what headline will draw movement, and recently there has not been much movement on the back of Johnsons' proposals. The closer we get though, the larger the swings will be.

We also have a slew of US employment data overnight. Contrary to what you would expect with all the pessimism floating around, Employment has been very good globally, especially in the States. If this trend changes and Unemployment starts to tick up, expect recession whispers to become louder.

Global equity markets have rebounded from being down overnight, - Dow +0.26%, S&P 500 +0.59%, FTSE -0.63%, DAX -2.76%, CAC +0.30%, Nikkei -2.01%, Shanghai -0.92%

Gold prices are up another 0.7% to at $1,513 an ounce. WTI Crude Oil prices are flat at $52.49 a barrel.

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