Collinson FX Market Commentary - Jan 26 - Trump sparks market frenzy

by Collinson FX on 26 Jan 2017

From the S-W Archives: 2015 Tauranga Cup, Takapuna January 2015 Richard Gladwell www.photosport.co.nz

Collinson FX Market Commentary - Jan 25 - Trump sparks market frenzy

Jan 26 - President Trump will build the wall! This sends a huge message to the electorate that he will fulfil his campaign promises, refreshingly unique, especially the infrastructure spending. The 'Wall' is a powerful symbolic message, confirming infrastructure spending, while addressing security and immigration promises.

This was enough to send equity markets into a frenzy, smashing through 20,000 on the Dow, for the first time!

The speed and energy with which Trump is moving to fulfil his program is astonishing and a massive shot in the arm for market confidence. The Dollar remained soft, with the EUR trading 1.0740, while the GBP moved above 1.2600. Australian inflation data missed expectations, to the downside, coming in at 1.5% p.a..

This confirmed weak growth in the economy and reinforced the RBA attitude towards low interest rates. This immediately impacted the AUD, which quickly relinquished 0.7600, only to stabilise back around 0.7550. The NZD had no such interruption, pushing strongly through 0.7200, looking to new highsCollinson FX Market

From the S-W Archives: 2015 Tauranga Cup, Takapuna January 2015 © Richard Gladwell www.photosport.co.nz

Collinson FX Market Commentary - Jan 25 - Trump gives 'Green Light'

Jan 25 - President Trump signed an executive order to 'green light' the controversial Keystone pipeline. This is the latest signal that it is full steam ahead for the Trump administration. The pipeline will open up oil resources and provide a massive boost to jobs in the energy sector. The pipeline will be made in the USA, providing a boost to the steel sector, leaving no doubt in the minds of disbelievers!

Opening up the energy sector will drive growth in the US economy and this was reflected in equity markets. European PMI numbers were positive, in both Services and Manufacturing, pushing local markets higher. The British Supreme Court ruled Brexit must be confirmed by parliament, sending nervous jitters through markets, although this was quelled by an announcement of a bill to go before Parliament almost immediately.

This allowed the GBP to hold above 1.2500, while the EUR trades 1.0750, with no major Dollar moves. Commodity currencies showed resilience, with the NZD trading around 0.7250, while the AUD moves towards 0.7600. The Trump administration is dominating markets in the first full week of power. This is likely to continue, in the coming week, while the impact on economic data will drive market direction.

From the S-W Archives: SKUD 18 sailing in rough weather at Sail Auckland 2013 © Richard Gladwell www.photosport.co.nz

Collinson FX Market Commentary - Jan 24 - Trump spooks markets

Jan 24 - Equity markets retreated from Fridays gains, spooked by the Trump administrations uncertainties, while the man signs executive orders. He has resigned from the TPP trade agreement and signalled the renegotiation of NAFTA, while promising a 'massive' reduction in regulation.

This was to encourage a large group of major businessman gathered at the White House and further promising 'huge' tax cuts!.

The Dollar also relinquished ground, with the GBP moving to 1.2500, while the Yen hit 113.00. The retreating reserve supported the commodity currencies, with the AUD holding 0.7550, while the NZD trades around 0.7200.

Expect a flood of activity from the White House, to drive market sentiment this week, shaping the administrations policy intent.

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