Westpac comments on the Reserve Bank of New Zealand decisions today
A very quick response from Imre Speizer at Wpac NZ.
In brief (bolding is mine)
– The RBNZ’s Monetary Policy Statement this morning cut the OCR by 25bp to 2.75% as was widely expected
AUD/NZD went from 1.0982 to 1.1065 on the release with some hesitation to back to 1.1007 before a decisive bull run to the highs of 1.1126. The key takeaway was that the bird is likely to go lower on the RBNZ’s opinion and they are leaving the door open to further and substantial rate cuts depending on data. In the press conference Wheeler explained that they are monitoring house prices in Auckland, the price of the Yuan and said that a sustained El Niño could have a big impact.
AUD/NZD turning more positive
AUD/NZD daily MACD is turning more positive towards 0.0000 from -0.0022 this month. There is room to go to the topside before the significant resistance at 1.1178 and 1.1221. The pair is in positive territory while above the 200 SMA on the hourly sticks, but requires closes above 1.1130.
For more information, read our latest forex news.
Today’s 25 basis point cut, which takes the OCR to 2.75 percent, isn’t likely to be last this year either.
In its Statement today the Reserve Bank stressed a reduction is warranted by the “softening economy” and “some further easing in the OCR seems likely”.
Driving the cut is growing concern about the international economic outlook, particularly China, the impact of falling dairy prices in New Zealand, a tappering off of building activity in Canterbury, declining business confidence, and very weak inflation.
Economic growth is potentioal on auction forecast to slow to an annual pace of 2 percent, down from over 3 percent a year … (I forex)
The American Petroleum Institute late Wednesday reported that crude supplies rose by 2.1 million barrels for the week ended Sept. 4, according to sources. Analysts polled by Platts forecast a climb of 300,000 barrels. October crude
was at $44.15 a barrel on Globex, unchanged from the settlement on the New York Mercantile Exchange. Supply reports were delayed by a day because of the Labor Day holiday. The more closely watched Energy Information Administration report is due Thursday.
Reserve Bank of New Zealand Governor Wheeler comments hitting the wires from his presser
He’s mainly talking about the housing Forex Market …
– Watching Auckland house moment very carefully
more to come
FXStreet (Guatemala) – Valeria Bednarik, chief analyst at FXStreet explained that the Americans closed the day modestly higher across the board, with stocks volatility and Central Banks in the eye of the storm.
“During Asian hours, stocks soared with the Nikkei 225 rallying over 1,340 points, which led to a strong opening amongst European equities. US futures trade Forex Marketd also sharply higher, but with little macroeconomic data around, and attention focusing on a US possible rate hike, and more easing chatter in Asia, stocks faded the rally and ended the day with losses. In the US, The number of job openings rose to a record high of 5.8 million on the last business day of July, according to the US Bureau of Labor Statistics, fueling hopes that the FED’s may begin raising its rates as soon as next September 17th.
The EUR/USD pair trade Forex Marketd as low as 1.1131 at the beginning of the American session, from where it slowly bounced back to close the day near the 1.1200 level. The early attempts to break through the figure have been short lived, with sellers still aligned in the 1.1200/40 region. “
For more information, read our latest forex news.
merican Petroleum Institute (API) crude oil inventories for the week to September 4
more to come
Note – This data is out earlier to API subscribers (at 4.30pm ET) and released publicly at 4.35pm ET.
The API data is closely watched as a guide to the U.S. Energy Information
Administration (EIA) data due tomorrow morning (US time).
The consensus estimate for tomorrow’s EIA report is currently for +872.73Kbbls (i.e. an inventory build).
note also. This data is normally out on Tuesday afternoon in the US but is a day later this week due to the holiday in the US on Monday of this week.
Note – check out the … (I forex)
Krispy Kreme Doughnuts Inc.
said Wednesday it earned $5.9 million, or 9 cents a share, in the fiscal second quarter, compared with $5.8 million, or 8 cents a share, a year ago. Revenue rose 5.7% to $127.3 million in the quarter, the doughnut maker said. Adjusted for one-time items, Krispy Kreme reported an adjusted net income of 15 cents a share. Analysts polled by FactSet had expected the company to report adjusted earnings of 18 cents a share on sales of $131.2 million. The company said its U.S. same-store sales rose 5.5% in the quarter, while international franchise same-store sales were down 2.7%. Shares of Krispy Kreme plunged after the revenue and earnings miss and were down as much as 17% in after-hours trading after ending the regular session down 0.8%.
How ’bout that Nikkei? 8th largest rise yesterday! Abe’s corporate tax cuts promises (like he hasn’t said that before) a big driver.
Coming up from Japan today … due at 2350GMT
FXStreet (Córdoba) – Gold prices plummeted this Wednesday, with spot gold down to a daily low of $1,101.22 a troy ounce, and ending the day around $1,108.00. The commodity initially fell on the back of risk appetite, with investors liquidating its safe-haven holdings in benefit of riskier assets.
But the decline accelerated during the American afternoon, as a better-than-expected minor jobs report, fueled speculation the FED may raise rates as soon as in its upcoming September 17th meeting.
Gold technical view
“Technically, the bearish potential has increased as the daily chart shows that the price extended further below its moving averages, whilst the Momentum indicator holds well below its 100 level, and the RSI indicator has accelerated lower, potentioal on auction around 38”, said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, the technical indicators have lost their bearish strength, but remain well into negative territory, with the RSI steady around 23, and the 20 SMA heading sharply lower well above the current level, all of which supports additional declines, particularly on a break below the mentioned daily low”.