Thursday April 8, 2010 - 21:03:33 GMT
Share This Story
Westpac Institutional Bank - www.westpac.co.nz
Forex Research - Morning Report
Morning Report Friday 9 April 2010
News and views
US equities rose after chain store sales reported very healthy March sales, but the opening hour saw sentiment affected by the continuing pall over Greece. The S&P500 is currently up 0.5%, following a -0.6% close in the Eurostoxx, and -3.1% in Athens. The spread between Greek and German 10yr government bonds widened another 20bp to a fresh record of 427bp. Ireland's AA rating was affirmed by Standard & Poor's, but so was the negative outlook. Commodities are 0.8% lower in aggregate, the main industrials only modestly lower. US 10yr treasury yields are 4bp higher following equities' lead, the 30yr auction decent enough.
The US dollar is unchanged over 24 hours, peaking at 81.90 early London, and sliding below 81.50 thereafter. EUR's early bottom was 1.3283, near key support, from which it rose to above 1.3360. The ECB kept the policy rate at 1.00%, the press conference of more interest, head Trichet soothing concerns around Greece. GBP rose from 1.5140 to almost 1.5280. The BoE kept the policy rate at 0.50% and didn't change the QE target. USD/JPY bounced from 92.80 to 93.40, unchanged on the day.
AUD fell into the Sydney close and continued to 0.9224, rebound from early London to 0.9290.
NZD fell to 0.7008 and rebounded to 0.7070. AUD/NZD consolidated between 1.3140 and 1.3180.
US initial jobless claims jump 18k to 442k. This jump may in part have reflected seasonal adjustment difficulties around Easter. In the previous week, continuing claims fell 131k to 4550k.
US chain store sales jumped 9.0% yr in March. A significant majority of major retailers reported very healthy March sales, with the timing of Easter a positive factor at the end of the month, and weather conditions more favourable for shopping.
Japanese machinery orders unexpectedly declined by 5.4% in Feb, to be 7.1% lower than a year earlier. Consensus expectations were for a 3.7% rise in the month and a 1.1% decline over the year. A decline in steel, chemical and electrical machinery orders were the main impetus for the monthly decline.
The Japanese current account narrowed further than had been expected in Feb to JPY1119bn, from JPY1713 in Jan. This was primarily the result of a decline in the trade balance (led by a decline in exports).
European Central Bank leaves rates on hold at 1.00%. The press conference was once again dominated by Greek and broader budget deficit concerns, demonstrating just how much of a non issue the on hold, rates appropriate stance of the ECB currently is. On the data front, Euroland retail sales volumes fell 0.6% in February, their third fall in four months, to be down 1.3% yr. Also German industrial production was flat in February, after a similar Jan result and falls through most of Q4 last year.
Bank of England on hold at 0.50% and asset purchases suspended again at GBP200bn. There was no other detail in the brief statement. On the data front, industrial production posted a decent 1.0% bounce in Feb, and house prices rose 1.1% in March (HBoS measure), both solid outcomes which hint at renewed economic growth heading into the second quarter.
AUD/USD and NZD/USD outlook next 24 hours: AUD is well supported at 0.9220 for a run through 0.9300. NZD continues to hug 0.7050, and should be contained by 0.7000 and 0.7100.
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.
Forex Trading News
Daily Forex Market News
Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."