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TUESDAY 2ND FEBRUARY 2010
Ranges NZD/USD: . 6995/7165 AUD/USD: . 8784/9074 NZD/AUD: . 7831/7970
Last week Another strong week for the USD, and a negative one for all other currencies. US data was surprisingly strong, pointing towards a faster recovery than expected, along with a rather cautious bullish tome from the FOMC on Thursday. Along with global sentiment shifting away from the risk currencies, we saw Kiwi and AUD sold off heavily all week. China’s effective tightening of domestic bank regulations and money supply also weighed heavily on the local currencies. What we did Stayed short Kiwi/USD Sold Euro/USD as the Euro has been weighed down by underperforming countries This week Starting off with some consolidation as the market looks to lock in some profit, and not get too ahead of itself. The Dollar has weakened over night and thus Kiwi AUD and Euro have had a mild bounce. The difference now is pickling levels to sell into, instead of buying as sentiment has definitely turned into a long Dollar story, as punters don’t want to miss out on the big move to come. Euro still hamstrung by Greece, Spain and others as they continue to underperform. All this adds up to a positive outlook for the big buck. Locally we have employment data out today, which should point the way ahead for the RBNZ. RBA later today 50-50 whether or not they will hike again as they have already hiked significantly but their data has been very strong. What we will do Wait for better levels to sell Kiwi AUD and Euro If RBA hike, selling NZD/AUD will be a good move as it now has room to fall further
The Week Ahead
Mon 1 Feb US Dec Personal Income Dec Personal Spending Dec Core PCE Deflator Jan ISM Factory Dec Construction Spending Eur Jan PMI Factory (F) UK Dec Net Consumer Credit Dec Net Mortgage Lending Jan PMI Manufacturing Tue 2 Feb NZ Q4 Labour Cost Index Pvt Ord Time Q4 QES Private Sector Ord Time Aus Dec NAB Business Survey RBA Policy Announcement, US Dec Pending Home Sales Jan Auto Sales mn ann’lsd Jpn Dec Labour Earnings Eur Dec PPI Ger Dec Retail Sales UK Jan House Prices Wed 3 Feb Aus Dec International Trade Bal, US Jan Corporate Layoff Announcements Jan ADP Private Payrolls Change Jan ISM Non-Manufacturing Survey Eur Jan PMI Services (F) Dec Retail Sales UK Jan PMI Construction Jan Consumer Confidence Jan BRC Shop Price Index Jan PMI Services Thu 4 Feb NZ Q4 HLFS Employment Q4 HLFS Unemployment Dec External Migration ann. Aus Dec Retail Sales Q4 Real Retail Sales Dec Dwelling Approvals US Q4 Productivity Q4 Unit Labour Costs Initial Jobless Claims w/e 30/1 Dec Factory Orders Jan Chain Store Sales Eur ECB Rate Decision Ger Dec Factory Orders UK BoE Rate Decision BoE QE Target Can Dec Building Permits Jan Ivey PMI nsa Fri 5 Feb Aus RBA Statement on Monetary Policy US Jan Non-Farm Payrolls ch’ Jan Unemployment Rate Dec Consumer Credit Fedspeak – St Louis Fed President Bullard on monetary policy. Ger Dec Industrial Production UK Jan PPI Can Jan Employment ch’
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