Please select your home edition
Collinson and Co

Collinson FX Market Commentary- June 19,2013 - Weaker Oz outlook

by Collinson FX on 19 Jun 2013
AucklandCupDay2-220313 (12) - 2013 Auckland Cup, Day 2 Richard Gladwell

Collinson FX market Commentary: June 19, 2013!Click_here to find out how to get CollinsonFX's free iPhone app

All eyes were on the Fed as the FOMC began the all important two day meeting. There has been considerable speculation that tapering will commence at this meeting but the market has ignored this view as equities have rallied strongly towards the record highs in defiance. Bernanke has already set the parameters with 2.5% growth and unemployment back to 6.5%.

The Growth/Inflation will be ball-park but the US is at least a year away from 6.5% unemployment. Bernanke's days are numbered, with Obama virtually sealing his fate which he has already intimated. It may be he will Preside over a massive expansion in the Money Supply in an effort to counter fiscal ineptitude but without the opportunity to set the pathway back to Monetary sanity. It seems he will out do his predecessor in terms of liquidity and Greenspan succeeded in creating huge market distortions in the form of bubbles!?

The Dollar remained surprisingly strong,considering the markets belief in continued QE with the EUR trading around 1.3400 and the GBP back to 1.5650. The important ZEW Economic Sentiment indicator in Europe rose boosting the single currency but the GBP slipped after the Bank of Englands new Governor took the hospital pass. Inflation is on the rise and QE is all but exhausted, so the Debt/Deficit scenario remains critical, while growth weak.

Relatively good compared to the EU! Housing Starts in the US rose 6.8% but this was tempered by a fall of 3.1% in Building Approvals! Commodities were mixed with Energy up and hard commodities lower. This did not help the AUD, which was undermined earlier, by the release of the RBA minutes.

The RBA suggested a weak economy and further space for interest rate cuts, which pushed the AUD back to below 0.9450. The KIWI dipped to 0.7950 with the moves but regained towards 0.8000, looking towards todays trade data. The focus remains zeroed in on the Fed and the results of the FOMC meeting tonight!

Collinson FX market Commentary: June 18, 2013

Markets were controlled by speculation of the Fed's actions arising from the FOMC meeting this week. A report from the Financial Times suggested Bernanke would announce a tapering of the $85 Billion QE infinity Policy this meeting. This cut the big gains being booked on global equity markets.

Status Quo was the expectation prior to this report and markets had been surging strongly. The article pared gains as speculation is overwhelming market fundamentals. The USD regained some momentum with the EUR back to 1.3360 and the GBP to 1.5715. In the US, the Empire State Manufacturing reported gains and gave a positive outlook for Manufacturing in the zone. This complimented a rise in the NAHB Home Price Index.

The Bulls have come out refreshed but this all relies on Ben Bernanke. Commodity demand fell and prices reacted accordingly, which pushed demand for the associated currencies lower. The KIWI fell back below 0.8000 as the USD regained some ground despite local Consumer Confidence rising. The AUD fell back to 0.9550 with momentum flagging and local news of stalling new vehicle sales.

Political turmoil is rife as Parliamentarians return to the Capital for their final sitting before the election. The political instability can not be helping the Australian market which is being reflected in the currency. Market determinations will revolve around the Fed and their announced decision.

For more on Collinson FX and market information see: and

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 - Nov 17 - NZ Confidence drifts lower
The Labour market remains strong but will not deter the accommodative monetary policy from the RBA. NZ Consumer Confidence drifted lower, reflecting the soft conditions in the NZ political environment, allowing the NZD to slip to 0.6850. Australian Employment numbers were lower, although the headline number improved, from 5.5% to 5.4%. The Labour market remains strong but will not deter the accommodative monetary policy from the RBA.
Posted on 17 Nov
Collinson FX Market Commentary - Nov 14 - Oz Government under siege
The AUD drifted to 0.7620, with chaos reigning in Canberra Markets opened the week quietly, with little economic data being released, globally. The focus in Europe fell upon a speech from ECB VP Vitor Constansio, who lauded the actions of the ECB, post-GFC. He pointed out the rising growth and flat inflation citing, a 'broad-based, robust and resilient recovery'
Posted on 14 Nov
Collinson FX Market Commentary - Nov 10 - US Dollar loses mojo
This allowed the KIWI to push back above 0.6950, but inflation without growth is a dangerous recipe The Dollar lost some mojo, with the GBP rising to 1.3150, while the EUR jumped to 1.1640. The European Commission revised inflation and growth expectations higher within the zone, which assisted the rise in the currency, despite monetary policy remaining slack.
Posted on 10 Nov
Collinson FX Market Commentary - Nov 7- GBP recovers, KIWI holds
AUD trading above 0.7650, while the NZD holds above 0.6900 US markets opened the week on a positive note with M & A activity in the Tech sector. Broadcomm offered to pay $70/share for Qualcomm in the biggest ever tech merger. The number will be in the vicinity of $130 Billion. Trump is in Asia, on an important trade tour, looking to resolve the North Korean crises plaguing Asian allies.
Posted on 7 Nov
Collinson FX Market Commentary - Nov 5-6 Reality revival for NZD
The currency has been under pressure, falling to 0.7640, while the NZD looks to regain 0.6900. Markets were steady, to close the week, after a couple of big announcements in the USA. Republicans tabled their Tax Reform Bill in the House and Trump announced Jay Powell as the new Fed Chair. These were both expected events, but necessary, as expectations remain high.
Posted on 6 Nov
Collinson FX Market Commentary - Nov 1 - Business confidence slumps
The AUD drifted below 0.7650, while the NZD is looking to test 0.6800, on the downside. NZ Business confidence contracted sharply, down 10.1%, which is a real-time economic measure. Employment data released today will reflect historical economic performance. As the 'grand rainbow coalition' establish their agenda, adding flesh to policy bones, historical data will begin to reflect the direction of the economy under the new Government.
Posted on 1 Nov
Collinson FX Market Commentary - Oct 31 - NZD stays steady
The NZD was steady, trading around 0.6850, while the AUD remains under pressure. The NZD was steady, trading around 0.6850, while the AUD remains under pressure. The fallout from the loss of the deputy PM, after eligibility issues, has taken the AUD to 0.7650. The loss of a majority in Parliament and continued flagging poll numbers have hit confidence.
Posted on 30 Oct
Collinson FX Market Commentary - Oct 30 - AUD slides in turmoil
The AUD has slipped back to 0.7650, while the NZD trades around 0.6850 The Australian political situation is in turmoil, with the incumbent Turnbull Liberal Government losing it majority in parliament. The situation is fluid but uncertainty breeds discontent. The AUD has slipped back to 0.7650, while the NZD trades around 0.6850, suffering the injustice of a socialist 'Grand Rainbow' coalition.
Posted on 30 Oct
Collinson FX Market Commentary - Oct 27 - KIWI drops further
The AUD slipped back to 0.7650, while the NZD fell to 0.6840 The AUD slipped back to 0.7650, while the NZD fell to 0.6840, with little on the economic front to excite. Australian inflation remains challenged, reflecting weak economic growth, while NZ economic conditions are challenged by the prospects of the new socialist coalition Government.
Posted on 27 Oct
Collinson FX Market Commentary - Oct 26 - AUD holds up KIWI
The NZD remains vulnerable, trading 0.6860 and only the weakness of the AUD has steadied the cross rate. Australian CPI was surprisingly weak, falling to 1.8%, from an expected 2% rise! This undercuts any talk of an RBA rate rise and undermines the AUD. The currency tanked, dropping below 0.7700, allowing the NZD to stabilise. The NZD remains vulnerable, trading 0.6860 and only the weakness of the AUD has steadied the cross rate.
Posted on 26 Oct