Collinson FX Market Commentary - Aug 30 - Missile triggers sell-off

by Collinson FX on 30 Aug 2017

J- Class Regatta - 35th America’s Cup - Bermuda June 19, 2017 Richard Gladwell www.photosport.co.nz

Collinson FX Market Commentary - Aug 30 -

North Korea fired yet another ICBM, this time over Japan, in provocation. This reignited tensions, in the immediate area, but has further reaching implications. European markets were sold off, while awaiting the return of serve from NOKO's neighbours and the USA. Trump has warned that 'all options remain on the table' but Kim Jong-In continues to poke the bear.

The sell off in markets continued in to US trade but was considered, digested and dismissed. Equity markets roared back and eliminating early losses, brushing off the global threat, while recognising the extent of the storm-flooding of Houston.

The flooding in Texas is dramatic and will take some time to overcome. The S&P Case Shiller Home Price Index posted marginal gains, while US Consumer Confidence pushed around record levels, soothing nervous markets. The EUR is testing 1.2000, while the GBP regained 1.2925, amidst continued weakness in the Dollar.

Commodity currencies continued to recover recent losses, with the AUD pushing back to 0.7950, while the NZD approaches 0.7250. Reserve weakness is a common theme and the coming tsunami of global economic data will determine the validity of those moves.

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Collinson FX Market Commentary - Aug 29 - Pressure goes on US oil

The US is preoccupied, or drowned in the Hurricane, that is Harvey. Much of Texas has been inundated and will test resources. There is pressure on the local oil market. The Dallas Fed Manufacturing Activity Index remained steady and markets reflect this.

The Dollar has been under extreme pressure, with the EUR testing new highs, heading towards 1.2000! The GBP has been under extreme pressure, with Brexit negotiations testing sentiment, but Dollar weakness has allowed the GBP to recover to 1.2900.

The reserve has ensured recovery in the commodity currencies, as the AUD pushed towards to 0.7950, while the NZD regained 0.7250. An avalanche of global economic data will provide plenty of ammunition for the remainder of the week

Collinson FX Market Commentary - Aug 27 - Brexit bites

Jackson Hole was a fizzer. Yellen addressed the symposium in generalisations and offered no insights in to monetary policy. She did offer commentary on the Financial System, which she descried as sound, supporting the regulations post GFC.

This could be interpreted as a resignation letter for Trump who is adamantly opposed to Dodd-Frank. US Durable Goods Orders plunged, down 6.8%, along with the Dollar. The EUR jumped above 1.1900, while even the GBP pushed to 1.2880, despite Brexit negotiations this coming week.

The AUD took advantage of the weaker reserve, pushing back to 0.7940, while the NZD consolidated above 0.7200. The coming week is an avalanche of global economic data lead by US and EU Employment. There is a plethora of Manufacturing and CPI data also providing much fodder for markets. Expect a huge week!

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