Please select your home edition
Edition
Collinson and Co

Collinson FX Market Commentary- July 31, 2013 - Aussie takes a bath

by Collinson FX on 31 Jul 2013
Sam Barnett and Zak Merton - 2013 420 Nationals, Takapuna Richard Gladwell www.photosport.co.nz

Collinson FX market Commentary: July 31, 2013

http://itunes.apple.com/app/collinsonfx/id533360650?mt=8!Click_here to find out how to get CollinsonFX's free iPhone app

Markets were treading water in anticipation of the FOMC meeting scheduled for a decision tomorrow. This should be a big day, with the all-important Fed meeting and crucial GDP data and the ADP Jobs Report. These three events, individually have the ability to move the market, so any uniformity of results could result in a big move.

The Fed is expected to begin to taper QE infinity by September so confirmation of this may have already been built in. Flagging GDP and falling Job prospects could signal a reversal of this tapering prospect but weakness and committment to easing would bring negative impact to equities, commodities and currencies (except for the USD)! The USD was creeping north in the lead up to the eagerly awaited announcement with the EUR 1.3250 and the GBP 1.5240.

The AUD took a bath yesterday, falling from 0.9200 to 0.9160 after Building Permits collapsed by 6.2% for the month and 13% annually! The economic news and the plunge in mining investment sparked dovish comments from the RBA Governor Stevens. The flagging economy may attract a rate cut at the next Central Bank meeting which undermined the Ozzie!

The KIWI lost some shine, after being tarred by the same brush, dropping below 0.8000 but blowing through 0.8800 in the cross v it's troubled trans-Tasman cousin.

All eyes on the Fed and GDP with ECB and BofE still to come this week! Non-Farm Payroll will ice the cake Friday!


Collinson FX market Commentary: July 30, 2013

Markets opened the new week with a hang-over from recent equity gains. US Markets were disappointed when the Pending Homes Sales contracted by 0.4% sending mixed signals in an industry considered a leading indicator. This week is all about Central Banks with the FOMC meeting tomorrow and ECB and Bank of England later in the week.

The other major driver for markets will be the Employment reports culminating with Non-Farm Payrolls. Tapering is expected to start in September and there has been plenty of warning so whether this impacts, we will have to see.

The Dollar was steady with the EUR 1.3250 and the GBP 1.5350. Commodities were mixed and expectations of Dollar gains have pushed the AUD back below 0.9200 and the KIWI barely holding 0.8000.rrencies and commodities will be driven by Central Bank action, commentary and market perceptions. It will be a huge week and expectations are for volatility


Collinson FX market Commentary: July 29, 2013

Markets remained flat with debate raging over whether the Fed will commence tapering of QE Infinity. Consumer Confidence surged to 85.1 from 83.9, reflecting a growing confidence in the banal economic recovery which could signal the 'beginning of the end' of Monetary Expansionism.

The week ahead holds prospects of huge moves in Currencies and Equities with Central Banks from the US and Europe taking center stage. The direction of Monetary policy is the major driver of market direction. If the Fed indicates a propensity to instigate a taming of QE then we may see the start of a long term rise in the US Dollar. It would probably impact equities negatively with the reduction in the avalanche of money.

The EUR has reached 1.3275 and the GBP 1.5390 with the diluted Dollar but this may change. Growth numbers and Jobs Reports in the US will also impact market direction.

The KIWI continues to surge, looking to test the 0.8100 level, but will come under considerable pressure if the USD worm turns. The AUD has also benefited a resurgence after recent tests of the important 0.9000 levels. The AUD settled to close around 0.9250 and will look to the new week for short term directional drivers.

For more on Collinson FX and market information see:
www.collinsonfx.com and www.collinsonwealthmanagement.com

Countries: | NZ: 0800 338 838 | AU: 1800 143 415 | NY: 1888 6257 833 | UK: 0800 0285 834 |


Disclaimer: The details expressed in this website and accompanying documents or transmissions are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. Collinson Forex Ltd accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the information contained or related to this site.

Collinson and Co

Related Articles

Collinson FX Market Commentary - Mar 24 - US tetters on health vote
The NZD held above 0.7000, despite a rising reserve, while the AUD continued to drift lower. The RBNZ left rates unchanged, as expected, observing weaker than expected growth allowing accommodative monetary policy. The Central Bank welcomed the weaker KIWI, while jawboning it lower, to little effect. The NZD held above 0.7000, despite a rising reserve, while the AUD continued to drift lower.
Posted on 24 Mar
Collinson FX Market Commentary - Mar 23 - NZD rallies against trend
Commodities continued to lose ground and the AUD suffered, falling below 0.7700, while the NZD bucked the trend. Commodities continued to lose ground and the AUD suffered, falling below 0.7700, while the NZD bucked the trend. The NZ Dairy Auction was surprisingly bullish, paving the way for a rally in the currency, pushing up to 0.7050. The RBNZ will announce the rate decision this morning, with no movement expected, although rhetoric is likely to impact.
Posted on 22 Mar
Collinson FX Market Commentary - Mar 22 - DOW drops 200 points
The AUD fell below 0.7700, after the Bank observed the Feds 'rate rise policy' Oil prices resumed their downward moves, reflecting commodity prices, in general. This did not assist the associated currencies, with the NZD drifting to 0.7020, while the RBA impacted the AUD. The RBA minutes revealed concerns over the growing real estate bubble and weak wage growth, but it was the commentary on the US Dollar that hit the currency.
Posted on 21 Mar
Collinson FX Market Commentary - Mar 20 - GBP slips on Brexit news
The AUD pushed back to 0.7700, while the NZD regained 0.7000, awaiting Mondays Dairy Auction. The GBP slipped after the UK PM, Theresa May, confirmed the trigger of Article 50 on March 29. Oil prices drifted lower and the Chicago Fed Manufacturing Activity Index remained positive. The softer reserve allowed commodity currencies to book further gains, with the AUD consolidating above 0.7700, while the NZD pushed towards 0.7050.
Posted on 21 Mar
Collinson FX Market Commentary - Mar 19 - Handbrake pulled on excess
The AUD pushed back to 0.7700, while the NZD regained 0.7000, awaiting Mondays Dairy Auction. What could have been a tumultuous week, Geo-Politically and Economically, faded into obscurity. The Fed raised rates, as expected, pushing a dovish commentary to calm any excesses. The Dutch election saw the status quo come through virtually unscathed, allowing a massive sigh of relief for the EU, with the anti immigration party also being anti-EU.
Posted on 19 Mar
Collinson FX Market Commentary - Mar 17 - Dutch Brexit fails in poll
The AUD slipped back to 0.7660, while the KIWI drifted back to 0.6970, awaiting the resumption of the Dollar run. The Dutch elections spread relief through European markets after the failure of the far right, anti EU party to live up to pre-poll expectations. The preservation of the status quo, will reduce fears held for the EU, especially considering the pending elections in France and Germany.
Posted on 16 Mar
Collinson FX Market Commentary - Mar 16 - US Int Rate up, Dollar down
The US Federal Reserve raised interest rates, for the second time post-GFC The US Federal Reserve raised interest rates, for the second time post-GFC, confirming the embarkation of a rate rise program for 2017. There were no surprises and the associated commentary confirmed the economic recovery and calmed markets. 'Buy the rumour, sell the fact'! The Dollar retreated after the anticipated rate rise
Posted on 15 Mar
Collinson FX Market Commentary - Mar 15 - Oil prices drop
Oil Prices hit the headlines overnight, falling to $47.70, hitting energy companies and dragging equities lower. Oil Prices hit the headlines overnight, falling to $47.70, hitting energy companies and dragging equities lower. The lower prices are a direct result of oversupply, with global stocks rising, as production does not inhibit. Equities were not assisted with the prospect of rising interest rates, as the FOMC sat down for their two day meeting, with high expectations.
Posted on 14 Mar
Collinson FX Market Commentary - Mar 14 - Big week ahead
AUD back below 0.7600, while the NZD has regained 0.6900 Markets were steady on what could develop into a huge week for currencies. This coming week the UK look to trigger article 50, the 'Brexit' clause, which will impact the GBP. The Dutch go to the elections and a strong showing of the anti-EU parties could adversely impact the EUR, both short term and fundamentally.
Posted on 13 Mar
Collinson FX Market Commentary - Mar 11-12 - KIWI recovers above 69c
Commodity currencies regained some ground, with the AUD back to 0.7550, while the KIWI jumped back above 0.6900. The Dollar has been on a bull run, which is likely continue, when the Fed embarks on a rate rise program for 2017. The Dollar settled to close the week, with the EUR jumping to 1.0690, supported by stronger than expected German trade data. Commodity currencies regained some ground, with the AUD back to 0.7550, while the KIWI jumped back above 0.6900.
Posted on 12 Mar