Wednesday January 23, 2013 - 19:00:09 GMT
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Westpac Institutional Bank - www.westpac.co.nz
Forex - Morning Report
Morning Report Thursday 24 January 2013
Sentiment across asset classes was restrained last night, although the US House vote to suspend the debt ceiling until 19 May (announced as we write) is staring to boost markets. IMF downgrades to its 2013 forecasts for World growth (from 3.6% to 3.5%) and Eurozone growth (-0.1% to -0.2%), a less hawkish Canadian central bank, and the UK Prime Minister’s pledge to hold a referendum on remaining in the EU earlier weighed. The S&P500 is currently up 0.1% after nudging to a fresh five –year high at the NY open helped by Google and IBM Q4 earnings. Brent oil is up 0.5%, copper down 0.5%, gold down -0.4% and Tianjin iron ore up 1.2%. US 10yr treasury yields fell from 1.84% to 1.81% before recovering around midday NY to 1.83%. Greece’s10yr yield rose 19bp.
The US dollar index (DXY) is little changed. EUR is little changed from the 1.3315 level prevailing around the NZ close, although it did eke a 1.3278-1.3354 range, the period following the IMF report most damaging. USD/JPY stabilised early London from 88.06 to 88.67. AUD initially recovered to 1.0568 but then slumped with EUR/USD to 1.0533. NZD similarly pushed higher to 0.8441 before falling to 0.8410. Australia’s CPI disappointment helped AUD/NZD make a multi-week low of 1.2500.
AUD and NZD Outlooks: The local data calendars are quiet today, NZ’s PMI and credit card spending reports not market movers, but China’s manufacturing PMI (HSBC version) is scheduled for this afternoon.
NZ 2yr swap yield 1 day: Opening today down unchanged at 2.81%.
NZ 2yr swap yield 1 month: Breaking above 2.80% towards 3.00%, supported by improving NZ data.
NZD/USD 1 day: Support today remains at 0.8380 (Friday’s high) for a push above 0.8440.
NZD/USD 1 month: The positive trend since May remains intact, targeting 0.8470 and beyond.
AUD/USD 1 day: Support today remains at 1.0525 (Monday’s high) for a push above 1.0580.
Westpac Banking Corporation ABN 33 007 457 141 incorporated in Australia (NZ division). Information current as at 24 January 2013. 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 registered in England as a branch (branch number BR000106) and is authorised and regulated by The Financial Services Authority. Westpac Europe Limited is a company registered in England (number 05660023) and is authorised and regulated by The Financial Services Authority. © 2010 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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