Monday October 12, 2009 - 19:37:21 GMT
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Westpac Institutional Bank - www.westpac.co.nz
Forex Research - Morning Report
Morning Report Tuesday 13 October 2009
News and views
Risk assets managed further modest gains in a evening session thinned by US, Canadian, and Japanese holidays. US equities remained open, the S&P500 up 0.7% to match the 2009 high of 1080 on low volume, buoyed again by Q3 earnings reports. The Fed's Bullard tempered his earlier hawkish views, saying deflation was still a risk and lower unemployment was a condition to a rate rise. Oil (+2.3%) followed equities and the weaker US dollar, while copper (+0.8%) rose on China growth expectations. European government bonds rallied on rumours buyer could not be found for a Dutch bank which is under central bank management.
The US dollar is lower, at 76.05, and close to breaking below the 75.83 key level. EUR rallied from the Sydney close, reaching 1.4813 where it has consolidated. GBP was under pressure, dipping to 1.5729, a post-May low, but has recovered to 1.5820 for little change. PM Gordon Brown added to the view that monetary stimulus should remain in place for several years, given the dire fiscal position. The dollar did perform against the yen, reaching 90.46, before settling at 89.80.
AUD knocked against the 2009 high for the third consecutive day at 90.83, after first dipping after Sydney closed to 0.8985.
NZD dipped to 0.7255 after the close, but then followed risk higher to 0.7362. After almost reaching the top of the five-month old channel yesterday afternoon, AUD/NZD settled around 1.2340.
No data to report.
AUD/USD and NZD/USD outlook today: The upward trends remain intact for both, and should take leads from the mildly risk-supportive evening sessions, as well as today's data (NAB business survey for AU, retail sales for NZ). AUD is well supported between 0.8950 and 0.9000, the NZD at 0.7250.
Westpac Banking Corporation ABN 33 007 457 141 incorporated in Australia (NZ division). Information current as at 14 November 2007. All customers please note that this information has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on this information, consider its appropriateness, having regard to your objectives, financial situation or needs. Australian customers can obtain Westpac's financial services guide by calling +612 9284 8372, visiting www.westpac.com.au or visiting any Westpac Branch. The information may contain material provided directly by third parties, and while such material is published with permission, Westpac accepts no responsibility for the accuracy or completeness of any such material. Except where contrary to law, Westpac intends by this notice to exclude liability for the information. The information is subject to change without notice and Westpac is under no obligation to update the information or correct any inaccuracy which may become apparent at a later date. Westpac Banking Corporation is regulated for the conduct of investment business in the United Kingdom by the Financial Services Authority. Â© 2004 Westpac Banking Corporation. Past performance is not a reliable indicator of future performance. The forecasts given in this document are predictive in character. Whilst every effort has been taken to ensure that the assumptions on which the forecasts are based are reasonable, the forecasts may be affected by incorrect assumptions or by known or unknown risks and uncertainties. The ultimate outcomes may differ substantially from these forecasts.
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