Analysis and Recommendation: The NZD/USD continued its decline falling to 0.6654 getting no benefit by the uptick in Chinese services PMI. The
The NZD/USD continued its decline falling to 0.6654 getting no benefit by the uptick in Chinese services PMI. The Unemployment rate held at 6% while the employment change tumbled. A weak Dairy Auction also weighs on the commodity currency. The kiwi weakened as traders favoured the greenback, betting US economic data broadly in line with expectations will prompt a hike in US interest rate hike next month. A 7.4 percent drop in average prices at the GDT auction overnight also weighed on the kiwi, as increased production from Europe and subdued demand keeps a lid on prices.
“While the US dollar advanced overnight, the New Zealand dollar underperformed other G-10 currencies following the weaker-than-expected GDT auction,” ANZ Bank New Zealand agri economist Con Williams and economist Dylan Eades said in a note.
New Zealand’s unemployment rate rose 6 percent in the September quarter, while employment unexpectedly shrank 0.4 percent, when investors had been expecting an increase. The weaker-than-expected data followed a 7.4 percent drop in the average price at Fonterra Cooperative Group’s GDT auction, and milk futures pricing indicates they may extend their decline.
Dairy prices “could overshoot the downside on this move – that’s certainly a question and we’ll have to wait and see, but it does push the RBNZ closer to a cut in December,” said Martin Rudings, senior deal foreign exchange at OMF in Wellington. “The kiwi was the worst performing currency last night and could easily well be again tonight.”
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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USD |
API Weekly Crude Oil Stock |
2.800M |
|
4.100M |
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NZD |
Employment Change (QoQ) (Q3) |
-0.4% |
0.4% |
0.3% |
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NZD |
Unemployment Rate (Q3) |
6.0% |
6.0% |
5.9% |
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AUD |
Retail Sales (MoM) (Sep) |
0.4% |
0.4% |
0.4% |
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AUD |
Trade Balance (Sep) |
-2.317B |
-3.000B |
-2.711B |
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CNY |
Caixin Services PMI (Oct) |
52.0 |
50.8 |
50.5 |
Upcoming Economic Events that you should be monitoring:
Wednesday, November 4, 2015
Cur. |
Event |
Actual |
Forecast |
Previous |
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AUD |
RBA Governor Stevens Speaks |
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JPY |
Monetary Policy Meeting Minutes |
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USD |
FOMC Member Stanley Fischer |
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EUR |
German Factory Orders (MoM) (Sep) |
|
1.0% |
-1.8% |
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EUR |
ECB Economic Bulletin |
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EUR |
Retail Sales (MoM) (Sep) |
|
0.2% |
0.0% |
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EUR |
ECB President Draghi Speaks |
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GBP |
Interest Rate Decision (Nov) |
|
0.50% |
0.50% |
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GBP |
BoE MPC Meeting Minutes |
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GBP |
BoE Gov Carney Speaks |
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USD |
FOMC Member Dudley Speaks |
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USD |
Initial Jobless Claims |
|
262K |
260K |
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USD |
Unit Labor Costs (QoQ) (Q3) |
|
2.3% |
-1.4% |
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USD |
FOMC Member Stanley Fischer |
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USD |
FOMC Member Lockhart Speaks |
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Government Bond Auctions
Date Time Country
Nov 03 10:10 Austria Holds RAGB bond sale
Nov 04 15:30 Sweden Announces details of Bond on 11 Nov
Nov 04 N/A Holland Announces details of Bond on 10 Nov
Nov 05 09:30 Spain Auctions Bonos
Nov 05 09:50 France Auctions OATs
Nov 05 10:03 Sweden Holds I/L bond auction
Nov 09 12:00 Norway Details bond auction on 11 Nov
Nov 09 15:30 Italy Announces details of BTPs/CCTeu on 12 Nov
Nov 09 N/A US Holds 3-year note auction
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