Collinson FX Market Commentary - June 23 - KIWI overvalued
by Collinson FX on 23 Jun 2017
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Collinson FX Market Commentary - June 23 - KIWI overvalued
The markets closed a quiet week meekly after disappointing PMI data from the EU.
The EU Manufacturing and Services PMI both drifted lower. Recent data has been negative after what looked like a building recovery. US PMI was also lower and these weak numbers provide a reason for flagging energy demand and associated prices.
The EUR approaches 1.1200, while the GBP moved back to 1.2725, reflecting a softer Dollar. Commodity prices have been weak, but the drifting reserve, enabled the AUD to trade 0.7570.
The fallout from the RBNZ meeting continues with the KIWI heading towards 0.7300!
The currency is overvalued as headline economic data camouflages the underlying problems. The economy is underpinned by immigration and heavily dependent on traditional primary exports.
Collinson FX Market Commentary - June 20 - Fresh start in Europe
The French Parliamentary elections confirmed a majority for the new President. Macron has been a revelation with a new political party sweeping aside the traditional left and right parties.
A fresh start in Europe has allowed markets some optimism and equities gained ground. In the US, New York Fed President Dudley, had a positive view of the US economy. He talked up growth prospects and the return to normal monetary policy. This supported the Dollar, with the EUR slipping back to 1.1150, while the GBP drifted to 1.2730.
Australian New Vehicle Sales were positive but the rising reserve pushed the AUD below 0.7600, while the NZD settled just above 0.7200. Local markets will be keenly awaiting the release of the RBA minutes and the Central Banks view of current economic click here and here Or for the latest update click here
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