RBNZ Posts on Forex Blog
FX Preview July 20 - July 25
Jul 19, 2008
This is a light weak for market data, with the most interesting reports coming out of:
Australia (PPI on Sunday, CPI Tuesday)
Canada (Retail Sales Tuesday and PPI Wednesday)
UK (BOE minutes Wednesday, Retail Sales Thursday, and Q2 GDP Friday)
Be careful getting long AUDUSD as the breakdown in oil and gold could spell trouble for the commodity based Aussie. I would stay long AUDNZD as that play is based on the comparative directions of the 2 economies.
Earnings from several regional banks and a possible diplomatic deal with Iran could be the biggest market movers for the USD.
I will be taking the next week off. Have fun trading!
Sunday July 20
9:30pm Australian PPI (expect 1.6% QoQ, 5.3% YoY)
Monday July 21
3:15am Swiss Producer and Import Prices (expect 0.5% MoM, 4.4% YoY)
time not listed Bank Of America Earnings (expect 0.53 a share)
Tuesday July 22
2:15am Swiss June Trade Balance (expect 1.6 billion)
4am Italy Trade Balance
8:10m US treasurer Hank Paulson Speaks
8:30am Canadian Retail Sales (expect 0.5% MoM)
9:30pm Australian CPI (expect 1.3% QoQ, 4.3% YoY)
time not listed Bank of Florida earnings (expect -0.01 per share)
after market close Etrade earnings (expect -0.14 per share)
after market close Washington Mutual earnings (expect -1.05 a share)
Wednesday July 23
4am Italy Retail Sales (expect 0% MoM, -0.4% YoY)
4:30am Bank of England minutes from last policy meeting
7am Canadian PPI (expect 0.5% MoM, 2.9% YoY)
7am Canadian PPI Core (expect 0.1% MoM, 1.6% YoY)
10:30am US Crude Inventories
5pm Reserve Bank of New Zealand Rate Decision (expect hold at 8.25%)
Thursday July 24
4am German IFO Survey (look for weakness mirroring the ZEW Survey last week)
4am Eurozone Current Account
4:30am UK Retail Sales (expect -2.2% MoM, 4.4% YoY)
10am US Existing Home Sales (expect 4.97 million)
7:30pm Japan CPI July
Friday July 25
4:30am UK Q2 GDP (expect 0.2% QoQ, 1.6% YoY)
8:30am US Durable Orders (expect 0%)
10am US New Home Sales (expect 507k)
10am US Michigan July Consumer Sentiment Finalized (expect 56.3)
time not supplied T Rowe Price earnings (expect 0.60 per share)
BOE, CAD, AUD, upcoming reports, RBNZ, Ifo, Pound
Kiwi Down Against 16 Majors, Rate Cuts this Fall
Jun 5, 2008
As expected, the RBNZ held rates steady at 8.25%. But,governor Bollard shocked forex traders today with an extremely dovish statement after their scheduled meeting. In his statement Bollard stated the RBNZ was "in a position to lower the OCR later this year". Indeed, New Zealand has been hit with their own slowdown recently. While house prices recently rose 2.7%, sales are down severely across the country. This has prompted the RBNZ to predict a 13% reduction in home values, 22% when inflation is factored in.
Bollard suggested that inflation will hit 4.7% in Q3, as such the bank is unlikely to cut until they see further deterioration. But in a nod to the realities of the slowdown, Bollard suggested GDP expansion would be extremely limited this year with only a modest recovery next year. This sharply contrasts with predictions made earlier this year for strong growth. Should weakness persist, the chances for a September rate cut will certainly pick up.
One shore over, Australia continues to see strong growth. GDP beat expectations by rising to 3.6% annualized - far higher than the 2.8% estimated. And, the trade deficit improved drastically, shrinking from AUS $2.55 billion to AUS $957 million in April. Indeed, with an expected growth of 20% in mining contract terms, and increases to iron ore still unaccounted for, the trade deficit may vanish entirely. Forex traders continue to speculate that Australia may raise rates once again in the next year.
September-October may be a wild period if the US and Australia raise rates while New Zealand cuts.
The Kiwi is down against all 16 majors. The NZDUSD is at 76.67, down more than 2% from yesterday.
GDP, NZD, rate cut, Kiwi, RBNZ
