Collinson FX Market Commentary - May 4 - Upbeat US commentary

by Collinson FX on 3 May 2017 Collinson FX Market Commentary - May 4 - Upbeat US commentary

The FOMC left rates unchanged and associated commentary was positive. The Fed sees moderate economic growth, inflation and steady labour markets. Expectations are for another rate hike, perhaps in June, giving support to the Dollar.

The EUR slipped below 1.0900, while the Yen has moved to 112.60, reflecting the rising Dollar. The ADP private sector jobs report was better than expected improving prospects for Fridays NFP and Employment data. The pressure on interest rate differentials between the AUD and USD finally took its toll.

The AUD dropped a big figure, to trade 0.7430, which is testing technical levels that may signal significant downside. The NZD was also impacted by the rising reserve, falling to 0.6870, despite strong local jobs data. French elections threaten European markets while Employment data in the US will be a point of speculation until Friday.

Collinson FX Market Commentary - May 3 - KIWI bounces back

European markets were steady, but nervous, ahead of the French run-off elections. A move for LePen would have the most dramatic impact on markets, as Macron represents the status quo, despite not being from the traditional political parties. LePen is the outsider, running to unseat the elite, destroying globalisation.

European manufacturing PMI data was steady, allowing the EUR to trade above 1.0900, while the Yen broke above 112.00.

The RBA left rates, at 1.5%, making it 8 times in a row. Rate cuts are over, despite residential real estate appearing to come off the boil, so any sign of serious inflation may encourage a rate rise. The AUD jumped to 0.7525 on the news, while the NZD consolidated above 0.6900, supported by a positive dairy auction.

Collinson FX Market Commentary - May 2 - KIWI bounces back

European markets were closed for the May Day celebrations and US markets were quiet. US Manufacturing data, in the form of ISM and PMI, was weaker than expected. Trump promises over tax reform and deregulation now have to be instituted, in the form of legislation, which have to be accomplished to cement the market rally. Trump was also about threatening the breakup of big Wall St Banks, which will come with de-regulation, but this will not scare many.

The EUR is trading around 1.0900, while the Yen moves back towards 112.00, reflecting a strong reserve. Speculation over the run-off French elections will cause volatility in markets, while Central Bank action and commentary, will impact this weeks markets. Commodity currencies began the week strongly, with the NZD jumping back above 0.6900, while the AUD trades click here and here Or for the latest update click here

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