NZ/Aus/S. Africa - Weekly Update - Written by renee on Wednesday, November 4, 2009 2:35 - 0 Comments
World First Foreign Exchange NZD / AUD Update: 5 October 2009
AUD
The AUD recovered from a weak start early in the week, finding local support in RBA Governor Glenn Stevens, Australian Retail Sales and reports supporting higher interest rates resulting in new highs for the year.
The RBA Governor told the Senate economic references committee early in the week that the rates were at ‘unusually low levels’, and when Retail Sales were released mid-week at a better than expected figure there was heightened speculation of an earlier interest rate hike.
At the same time, the RBA released reports on Private Building Approvals & House Prices as Governor Glenn Stevens became the poster boy for Australian Dollar strength for reminding the market that rates will need to be increased ‘at some point’. The Building Permits figure was worse than expected, however this supported an increase in rates as a means to curb property prices and kick-start the construction sector.
As overseas equity markets fell sharply towards the end of the week, the Aussie followed suit against the Greenback as the market anticipated and then received a host of poor employment data out of the US on Friday night, namely Non-farm Payrolls.
The week ahead in Australia
Monday 5th – ANZ Job Advertisements.
Tuesday 6th – Trade Balance, RBA Interest Rate Decision.
Wednesday 7th – Home Loans, Investment Lending.
Thursday 8th – Unemployment Rate, Employment Change, Foreign Reserves..
AUDUSD
The AUD is still most closely correlated to risk appetite via overseas equity markets, in particular the S&P500. The AUDUSD started last week at 0.8652, only to push higher mid week to reach the 0.8850 level. The currency pair finished the week at 0.8680.
The week ahead in the US:
Monday 5th – ISM Non-manufacturing.
Tuesday 6th – API Crude Oil inventories, ABC/Washington Post Consumer Confidence.
Wednesday 7th – MBA Mortgage Applications, EIA Crude Oil Stocks, Consumer Credit, Monthly Budget Statement.
Thursday 8th – Initial Jobless Claims, Continuing Jobless Claims, Wholesale Inventories, Fed’s Bernanke Speech.
Friday 9th – Fed’s Lockhart Speech, Trade Balance, Fed’s Kohn speech.
AUDGBP
The AUDGBP showed more volatility last week, initially tracking upwards until Thursday when risk aversion returned to the market leading up to the US unemployment figures. The pairing started the week at 0.5421, peaked mid week at the 0.5530 level and then fell away to close the week at 0.5452.
The week ahead in the UK:
Monday 5th – PMI Services.
Tuesday 6th – Halifax House Prices, Industrial Production, Manufacturing Production, NIESR GDP Estimate, Nationwide Consumer Confidence.
Wednesday 7th – BRC Shop Price Index.
Thursday 8th – BoE Interest Rate Decision.
Friday 9th – PPI, Total Trade Balance.
AUDEUR
This pairing started the week at 0.5889 pitching to 0.6050 and then falling heavily to close the week 0.5946.
The week ahead in the Eurozone:
Monday 5th – Retail Sales.
Wednesday 7th – Factory Orders (Germany).
Thursday 8th – Industrial Production (Germany), ECB Interest Rate Decision, ECB Trichet’s Speech.
Friday 9th – CPI (German), Trade Balance (Germany),
NZD
Economic data out of New Zealand last week was supportive of further domestic strength with Building Permits rising 1.7% whilst Business Confidence came out at 49.1 against the previous month’s 34.2. The demand for property continued, stimulated by the current interest rates of 2.5%.
The NZD rose on Tuesday against the JPY after the Japanese Finance minister corrected an earlier statement and said he may intervene to weaken the Yen. Late in the week risk aversion prompted a fall in the NZD as overseas equity markets fell, prompted by the worse than expected US unemployment data on Friday
The week ahead in NZ:
Monday 5th – ANZ Commodity Prices, NZIER Business Confidence.
AUDNZD
AUDNZD started the week at 1.2061 and strengthened, reaching the 1.2240 level mid week and then closed at 1.2122.
GBPNZD
It was a volatile week for this currency pairing, starting the week at 2.2043, reaching 1.2344 mid week and then closing the week at 2.2276.
EURNZD
EURNZD started the week at 2.0454 and weakened to close the week at 2.0361.
NZDUSD
The pairing started the week at 0.7165 and strengthened to reach the 0.7250 mid-week and then closed the week at 0.7125.
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