Market Roundup
- NZ Q1 HLFS Job Growth QQ, -0.2%, 0.5% forecast, 0.1% previous.
- NZ Q1 HLFS Unemployment Rate, 4.2%, 4.2% forecast, 4.3% previous.
- NZ Q1 Labour Cost Index YY, 2.0%, 2.1% forecast, 2.0% previous.
- United Kingdom April 2019 nationwide house price yy increase to 0.9 % (forecast 0.7 %) vs previous 0.7 %.
- United Kingdom April 2019 nationwide house price mm increase to 0.4 % (forecast 0.2 %) vs previous 0.2 %.
- China, U.S. start latest trade talks after 'nice' working dinner.
- UK shop price inflation falls for first time since Oct – BRC.
- Venezuela's Guaido calls for 'largest march in history' in uprising effort.
- Mueller complained to Barr about his summary of Russia probe - Washington Post.
- As Fed meets, Trump calls for sharp rate cut, stimulus.
- Australia April AIG Manufacturing Index, 54.8, 51.0 previous.
- Australia home price slide slows, may be "past worst".
Economic Data Ahead
- (1000 ET/1400 GMT) UK April Markit/CIPS manufacturing PMI, 53.0 forecast, 55.1 previous.
- (1000 ET/1400 GMT) UK March BOE Consumer Credit, 1.000 bln forecast, 1.145 bln previous.
Key Events Ahead
- (0430 ET/0830 GMT) City Lecture with Luis de Guindos, Vice-President, European Central Bank organised by OMFIF in London.
- (0913 ET/1315 GMT) The chairman of the Bank of England oversight body, Bradley Fried, speaks to the Treasury Committee in parliament in London.
- (1400 ET/1800 GMT) U.S. Federal Reserve's Federal Open Market Committee (FOMC) announces its decision on interest rates followed by a statement in Washington D.C..
- (1430 ET/1830 GMT) U.S. Federal Reserve chairperson holds a news conference in Washington D.C..
- (1615 ET/2015 GMT) Bank of Canada Governor Stephen Poloz and Senior Deputy Governor Carolyn Wilkins will testify to the Senate banking committee in Ottawa.
FX Recap
USD: Against a basket of currencies, the dollar was flat at 97.51 and still not far from last week's near two-year peak of 98.330.
EUR/USD: The euro climbed to a one-week high against the dollar on Tuesday after first-quarter economic growth figures in the euro zone beat market expectations, dispelling some pessimism over the economic bloc's common currency. In early Asian hours, the euro was 0.3% higher at $1.1219 after the euro zone growth data. The currency ended up 0.01% in April, shaving its year-to-date loss against the greenback to 2.17%. It made intraday high at $1.1219 and low at $1.1210 mark. A consistent close below $1.1215 will drag the parity down towards key supports around $1.1175, $1.1080 and $1.0852 levels respectively. Alternatively, reversal from key support will drag the parity higher towards key resistances around $1.1390, $1.1472, $1.1550, $1.1620 and $1.1820 marks respectively.
USD/JPY: The Japanese yen trades almost flat around 111.48 mark as Japanese banks will be closed in observance of Labour Day. It made intraday high at 111.50 and low at 111.37 levels. A sustained close above 112.17 is required to take the parity higher towards key resistances around 112.60 and 113.98 marks respectively. Alternatively, a daily close below 111.40 will drag the parity down towards key support around 110.80, 109.70, 107.50 and 104.20 marks respectively.
GBP/USD: The Sterling stabilizes above $1.30, hitting a two-week high, on Tuesday after media reports that the tone of Brexit talks between the British government and the main opposition party had improved. Prime Minister Theresa May is seeking a consensus with Labour to get a Brexit deal approved and wants talks to reach a conclusion by the middle of next week, several British journalists reported on Tuesday. The pound rose to as high as $1.3049, with broad dollar weakness and end-of month portfolio changes by asset managers cited as possible reasons for the move alongside the Brexit-related optimism. Pair made intraday high at $1.3046 and low at $1.3024 mark. A sustained close below $1.3030 requires for dragging the parity down towards key support around $1.2897 and $1.2772 mark respectively. On the other side, key resistances are seen at $1.3049, $1.3187, $1.3215, $1.3362 and $1.3490 levels respectively.
AUD/USD: The Aussie was a fraction firmer on the U.S. dollar at $0.7053, though trade was very thin with much of Asia and Europe on holiday. The pair made intraday high at $0.7056 and low at $0.7035 levels. A consistent close below $0.7015 requires for downside rally.
NZD/USD: The New Zealand dollar took a spill on Wednesday after disappointing jobs data only added to expectations that interest rates would have to be cut, perhaps as soon as this month. The kiwi dollar was down 0.37 percent at $0.6648, having been as low as $0.6625 at one stage. A sustained close above $0.6673 requires for the upside rally. Alternatively, key support was seen at $0.6580 mark.
Equities Recap
Most of the Asian stock markets will remain closed in observance of Labour Day.
Australia's S&P/ASX 200 index was up 0.32 pct at 6,345.70 points in early trade.
Commodities Recap
Oil prices fell on Wednesday after a report showed a rise in U.S. crude inventories, but global markets remained tense amid an intensifying political crisis in Venezuela, tightening U.S. sanctions on Iran, and ongoing OPEC supply cuts. Brent crude oil futures were at $71.59 per barrel at 0402 GMT, down 47 cents, or 0.7 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures were down 60 cents, or 0.9 percent, at $63.31 per barrel.
Gold prices were little changed on Wednesday, having edged higher in the previous session on a weaker dollar, as investors await the U.S. Federal Reserve's decision on interest rates later in the day. Spot gold was nearly steady at $1,282.01 per ounce as of 0107 GMT. U.S. gold futures were also little changed at $1,284.30 an ounce.
Treasuries Recap
Yields on two-year NZ government bonds likewise fell back to 1.42 percent, having been as high as 1.475 percent on Tuesday.
Australian government bond futures were unchanged as the market awaited the outcome of the U.S. Federal Reserve's policy meeting later in the day. The three-year bond contract held at 98.745, with the 10-year contract at 98.2000.
