Collinson FX Market Commentary - Nov 14 - Oil drops after Asians ease

by Collinson FX on 15 Nov 2015 Collinson FX Market Commentary - Nov 14 - Aussie cards fall OK Click here to find out how to get Collinson FX's free iPhone app

Nov 14 - Equities took yet another hit to close the week, as economic data comes in softer than expected, while commodities reflect demand. Asian markets are consuming less commodities and this has been headlined by Oil prices which have slipped to $40/barrel.

Central Bank malevolence has corrupted markets in an attempt to counter extreme fiscal irresponsibility. The threat from the main offender, the Fed, is to finally raise rates. Inevitability should be cautioned despite the corner they have boxed themselves into. Excuses will be not hard to find and any rate rise will be symbolic and probably temporary.

The fight to the bottom for global currencies has been driven by Fed speculation, pushing the EUR to 1.0750, while the GBP holds above 1.5200. Commodities have been under extreme pressure for an extended period, although stronger economic data domestically has assisted the AUD back above 0.7100, while the NZD languishes above 0.6500. Economic data will remain soft and Central Bank actions and speculation remains the major driver of equities and currencies.

Collinson FX Market Commentary - Nov 13 - Aussie cards fall OK

Nov 13 - Commentary from Fed member, Bullard, confirmed targets of Employment and Inflation have been met. This encouraged further speculation of a December interest rate rise and forced equities lower. The Dollar was steady, with the EUR trading 1.0750, while the GBP inched above 1.5200.

Some surprisingly good news from Australia boosted the currency. Unemployment plunged, from 6.2% to 5.9%, with the addition of an enormous 58.600 jobs. The AUD shot back to 0.7100 aided by further improvements in Consumer Confidence.

Everything is falling into place since the leadership change by the Government, although much of the groundwork was in place. The KIWI managed to add further consolidation, holding above 0.6500, but the cross with the AUD has suffered. Central Bank commentary and activity remain the main game in town!

Collinson FX Market Commentary - Nov 12 - China Retail Sales flailing
Nov 12 - China Retail Sales were flailing, while Industrial Production dipped, reflecting a slowdown in the Worlds factory. Input prices have become more attractive, but this has failed to stimulate the economy, demand wanes!

The reflection is in the commodity prices, which remain soft, driving the associated currencies. The AUD rallied to around 0.7040, while the NZD looks at 0.6540.

A slow economic data week has left a flux in equity markets awaiting Central Bank interference. All eyes now focus on speculation of interest rate activity of the Central Banks.

Collinson FX Market Commentary - Nov 11 - AUD and NZD consolidate
Nov 11 - Moody's warned the world economy's ability to fight further shocks would be impaired by the extremely loose monetary policy and high debt levels. This is stating the obvious, but is necessary, as Central Banks and Governments do not seem to appreciate the dangerous route they have been travelling down.

Chinese CPI was lower, 1.3% from 1.5%, reflecting the lack of growth pressure in challenging conditions. This did little to inspire markets with equities drifting across Europe and the USA. Currencies were steady, with the EUR falling below 1.0700, while the GBP traded around 1.5100.

Commodity currencies were stable, with the AUD and NZD consolidating above 0.7000 and 0.6500, respectively. Chinese Retail Sales and Industrial Production may impact global markets today but Central Bank commentary and activity remain the major driver.

Collinson FX Market Commentary - Nov 10 - Chinese imports plunge
Nov 10 - The OECD released a down beat economic report overnight. Emerging markets have been hit hard by commodity prices, impacting global trade, leading to less optimistic projections. The U.S. has been sustained by consumer demand and expectations are for growth around 2.5%. The EU is being supported by the ECB Monetary Policy and extended fiscal deficits, which can only be considered emergency measures, does not bode well.

China is expected to grow, but at a declining rate over time, but the Asian slowdown has impacted powerhouses China and Japan. Chinese Trade data confirmed this, with exports falling 6.9%, while imports plunged 18.8%! This did not inspire markets, with global equities plunging sharply. Non-Farm Payrolls beat expectations and this enhanced chances of a Fed interest rate rise, adding to negative sentiment spreading across equity markets.

The EUR traded 1.0750, while the GBP held 1.5100, hit hard by the resurgent Dollar. Commodity currencies consolidated, with the AUD bouncing from 0.7000, while the KIWI fought to hold 0.6500.

Chinese inflation, Retail Sales and Industrial Production will influence markets over the next couple of trading days. All is not well despite the Feds rose coloured glasses.

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