Collinson FX Market Commentary - Oct 1 - AUD opens gap on KIWI

by Collinson FX on 3 Oct 2016 Collinson FX Market Commentary - Oct 1 - AUD opens gap on KIWI

Oct 1 - The University of Michigan Confidence rose to 91.2, closing a week punctured by Banking scares and Oil Cartel agreements. This coming week is filled with economic data releases, headlined by US Employment and European Manufacturing.

Expectations should not be high, thus encouraging further speculation regards continued QE. The EUR wallowed around 1.1200, while the GBP holds stubbornly below 1.3000, seeking a shot in the arm. Commodity currencies have undergone some Central Bank influence, highlighted by the weakening in the KIWI.

The NZD traded below 0.7300, while the AUD pushed back to 0.7650, looking for a big week of influence from the reserve.

Collinson FX Market Commentary - Sept 30 - OPEC shores up Oil prices

Sept 30 - German Employment was static, holding 6.1%, while inflation benign. German CPI was 0.1%, a slight improvement on zero, but reflecting the state of 'irons' the EU economy continues to suffer. The US Trade deficit contracted slightly, but remains in extreme imbalance, while GDP growth was 1.4%.

US GDP growth has remained in the doldrums, throughout the Post-GFC crises, a need for a quantum change to the economy is needed. Elections in the US presents this opportunity. The EUR held 1.1200, while the GBP consolidated below 1.3000, as the Dollar treads water. Reserve inactivity has produced a meandering currency, allowing the KIWI to drift to 0.7240, while the AUD dipped below 0.7650.

Speculation continues on the Banking Sector, while OPEC cuts have shored up the Oil price, although solidarity will be the key to cartel effectiveness?

Collinson FX Market Commentary - Sept 29 - Reds back oil pumping cuts

Sept 29 - Opec plus Russia reached an agreement to cut oil production overnight which allowed the price to move back to $47/barrel. They do not have the sway of the cartels from the past and solidarity will be desperately hard to pursue.

US Durable Goods Orders fell flat, highlighting the weakness of the all important consumer market. Equities benefit the expansive monetary policy pursued globally, while currencies battle for the bottom, with the EUR trading 1.1200 and the GBP 1.3025.

Commodity currencies held ground, with the AUD trading 0.7675, while the KIWI struggled around 0.7250. RBNZ antics play to the current behaviour of the currency.

Collinson FX Market Commentary - Sept 28 - USD weakens as others gain

Sept 28 - Equities turned positive overnight, fired by some lethargic economic data. reinforcing the economic narrative. New Home Sales in the USA contracted 7.6%, while the Richmond Fed Manufacturing Activity Index fell 3.7%, confirming support for the Fed expansionist monetary policy.

This did little for the Dollar, as the EUR jumped to 11220, while the GBP regained 1.3000! The reserve weakness enabled the KIWI, which jumped back towards 0.7300, while the AUD broke above 0.7650. Economic data confirms Central Bank speculations and realities.

Collinson FX Market Commentary - Sept 27 - Oil Production cuts?

Sept 27 - Questions over the international banking sector came to the surface overnight, with doubts about the mega-bank, Deutsche. Problems of capitalisation are again under scrutiny, impacting other financial global institutions, as connection is global.

OPEC met, with the addition of Russia, while Saudi Arabia and Iran promoted production cuts. This boosted the Oil price, dragging energy prices north, but failing to support other commodity prices. US New Homes Sales plunged 7.6%, while the Dallas Fed Manufacturing contracted 3.7%, confirming recent weak economic data.

The NZD was under pressure, with speculation of RBNZ cuts, adding to worrying trade data. The trade deficit widened, with a rise in Imports and a fall in Exports, spurred by the overvalued KIWI. The NZD fell to the low 0.72's, but regained some ground overnight, to trade above 0.7250. The AUD held firmly above 0.7625 pushing the trans-tasman cross. The EUR has reacted to a weaker reserve, settling around 1.1250, while the GBP consolidates below 1.3000.

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