Analysis and Recommendation: The NZD/USD surged 40 points on the hopes of Chinese stimulus and is trading at 0.6560 after the release of weak import and
The NZD/USD surged 40 points on the hopes of Chinese stimulus and is trading at 0.6560 after the release of weak import and export numbers on Sunday. The drop in imports should be weighing on the kiwi, but has been offset by hopes of monetary intervention by the PBOC.
The US dollar index, which measures the greenback against a basket of currencies, jumped to its highest level in seven months after a report on Friday showed US nonfarm payrolls increased by 271,000 in October, the biggest gain this year and ahead of the 180,000 expected for the month. The labour market data is closely watched by the Federal Reserve and comes after chair Janet Yellen said last week that the upcoming December meeting was a “live possibility” for an interest rate hike.
The NZD was hit by concern about slowing economic growth in China, the country’s largest trading partner, after data released at the weekend showed Chinese exports fell for a fourth straight month in October to be 6.9 percent lower than a year earlier, while imports dropped 18.8 percent.
The (Chinese) central bank will maintain stable monetary policy and create a neutral monetary and financial environment for economic restructuring, according to the third-quarter Monetary Policy Implementation Report it released Friday. The PBOC also said the economy faces downward pressure and inflation is likely to be low.
Those comments “signaled the PBOC’s intention to prevent a secular fall in demand amid transition to the ‘new normal,’ ” Goldman Sachs Group Inc. economists including MK Tang in Hong Kong said in a report Sunday.
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.
Today’s economic releases:
Cur. |
Event |
Actual |
Forecast |
Previous |
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EUR |
German Trade Balance (Sep) |
|
20.0B |
19.6B |
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EUR |
Eurogroup Meetings |
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|
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USD |
FOMC Member Rosengren Speaks |
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Upcoming Economic Events that you should be monitoring:
Tuesday, November10, 2015
Cur. |
Event |
Actual |
Forecast |
Previous |
|||
JPY |
Current Account n.s.a. (Sep) |
|
2.235T |
1.653T |
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GBP |
BRC Retail Sales Monitor (YoY) (Oct) |
|
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2.6% |
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AUD |
Home Loans (MoM) (Sep) |
|
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2.9% |
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AUD |
NAB Business Confidence (Oct) |
|
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5 |
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CNY |
CPI (MoM) (Oct) |
|
-0.2% |
0.1% |
|
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CNY |
CPI (YoY) (Oct) |
|
1.5% |
1.6% |
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CNY |
PPI (YoY) (Oct) |
|
-5.8% |
-5.9% |
|
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EUR |
EU Finance Ministers Meeting |
|
|
|
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USD |
Export Price Index (MoM) (Oct) |
|
-0.2% |
-0.7% |
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USD |
Import Price Index (MoM) (Oct) |
|
-0.1% |
-0.1% |
Government Bond Auctions
Date Time Country
Nov 10 10:30 UK 0.125% 2058 I/L Gilt auction
Nov 10 N/A Holland Eur 2.0-3.0bn 0% Apr 2018 DSL
Nov 10 N/A US Holds 10-year note auction
Nov 11 10:03 Sweden Holds bond auction
Nov 11 11:15 Norway Holds bond auction
Nov 11 10:30 Germany Eur 3bn 0.25% Oct 2020 Bobl
Nov 12 10:10 Italy Auctions BTPs/CCTeus
Nov 12 10:30 UK 4.25% 2039 Gilt auction
Nov 12 N/A US Holds 30-year bond auction