EncoreFX’s daily market updates are written by our experienced and professional dealing team.
The Kiwi Dollar has made ground across the board gaining over 1% as yesterday’s closely watched inflation data came in above expectations. The Consumer Price Index was up 0.1% for the December quarter, with the annual number steady at 1.9%. While the result was below RBNZ forecasts of 2%, it was above market expectations of 1.8%. The result has perhaps dampened some views that a rate cut was likely later this year.
In other news, the Canadian Dollar was weaker after soft retail sales data, while the Japanese Yen also lost ground as the Bank of Japan kept its policy settings unchanged but once again lowered its inflation forecasts
US Government Shutdown Continues
Still no progress on the US Federal Government partial shutdown with even the White House now conceding it will take a severe toll on Q1-2019 growth. Meanwhile, trade war uncertainty continues to be the main influence on market sentiment with White House National Economic Council Director, Larry Kudlow, dispelling rumours that a planned meeting between trade representatives of the United States and China have been cancelled. Kudlow stressed that the two sides were on track to have very important high-level talks at the end of the month.
Pound at Two Month Highs
The British Pound continues to surprise many as it traded a two month high vs both the USD and EUR overnight. The threat of a no-deal Brexit appears to be becoming less likely with reports suggesting the Labour Party will support a proposal to extend the March 29 deadline. Of course the unknown is whether the EU would agree to the extension.
AUD Employment Today
The NZD/AUD cross rate made good gains yesterday as the NZD rallied on the local CPI result. The next big event for this currency pair is this afternoon’s employment report out of Australia. The labour market report will be closely watched, with the unemployment rate expected to be steady at 5.1%
© Copyright - EncoreFX, 2018.The information in this post is provided for general information purposes only and has been prepared without taking into account any person’s objectives, financial situation or needs and, accordingly, it does not constitute personalised financial advice under the Financial Advisers Act 2008, nor does it constitute advice of a legal, tax, accounting or other nature to any person. Before acquiring any financial services or products from EncoreFX, you should consider the appropriateness of the information having regard to your own objectives, financial situation or needs. We recommend that investors seek advice from their usual adviser before taking any action. EncoreFX (NZ) Ltd is a registered Financial Services Provider (FSP 461386), and is a licensed derivatives issuer under the Financial Markets Conduct Act 2013. EncoreFX (NZ) Ltd has lodged a Product Disclosure Statement (PDS) for each of our derivatives with the Registrar on 21-Dec-2016. A copy of each PDS is available from us or from the Registrar at www.business.govt.nz/disclose.