Tuesday February 7, 2006 - 20:17:41 GMT
Share This Story
Westpac Institutional Bank - www.westpac.co.nz
Forex: Westpac Institutional Bank Morning ReportNew Zealand Dollar Yield related demand supports NZD ahead of employment data.
The local market returned from Mondayâ€™s Waitangi Day holiday to a softer Kiwi following robust US employment data, overnight on Friday. Although the currency tested lows of 0.6805 early, news of further yield related demand stopped the currency pressuring 0.6800. With reports of additional EuroKiwi & Uridashi issuance from EIB & Rabobank outstripping expected redemptions, the currency remained supported and recovered over the day to a high of 0.6832. During the offshore session, gains to 0.6847 proved short lived with the currency once again pressured towards 0.6800, ahead of key domestic employment data due for release over the next two days.
Australian Dollar: AUD finds support at 0.7400
Tuesday proved to be more subdued than the previous day for the AUD as it was largely kept to a 50 basis point range. After plummeting on Monday the AUD found strong support around the 0.7400 level yesterday morning. Much of the demand was coming out of Asia and AUD/USD drifted higher to trade an intraday high near 0.7450. Traders marked the currency down late in the day and\ we open this morning at 0.7420.
Major Currencies: Positioning ahead of BOJ meeting sees Yen squeezed higher
The yen surged across the board on Tuesday amid market jitters before the Bank of Japanâ€™s policy meeting this week and a report that a large Japanese investor may shy away from dollars. A short squeeze saw the yen rally to a session high of 117.61 against the dollar recovering all of the ground it gave it up the previous day as currency traders unwound their negative yen positions. The euro popped up briefly over 1.2000 against the dollar earlier in the day but this rally was curtailed by a surprise 0.5% drop in German industrial output in December, the second consecutive monthly decline. This morning EUR opens around 1.1970 roughly where it finished the NZ session yesterday and JPY opens down from itâ€™s highs around 118.05.
No US data to report.
German industrial production falls 0.5% in Dec.
A sharp decline in capital goods output led the Dec IP fall, which followed a 0.4% decline in November. The output trend is still positive, but the industrial sector did appear to lose some momentum in Q4.
UK retailers less up-beat in Jan.
The British Retail Consortium reported same store sales up just 0.2% on Jan 2005, compared to Decâ€™s 2.6% annual pace.
Country Release Last Forecast
Aus RBA policy announcement 5.50% 5.50%
Feb WBC-MI consumer sentiment 2.6% â€“
NZ Q4 Labour cost index (priv, ord time) 0.8% 0.7%
Q4 QES wages (priv, ord time) 1.4% 0.9%
Dec, Jan ANZ commod prices (NZD) 0.1% â€“
Jpn Jan M2+CD money supply %yr 2.0% â€“
Jan bank lending % yr -0.1% flat
Bank of Japan meeting â€“ â€“
UK Dec industrial production 0.6% 0.4%
Jan BRC shop price index â€“ â€“
Jan housing starts 228K 224K
US Treasury Secretary Snow â€“ â€“
Latest Research papers/Publication
â€¢ NZ Economic Overview January 2006 (1 February)
â€¢ NZ Labour Market Preview (1 February)
â€¢ NZ Terms of Trade:History & Significance (26 January)
â€¢ NZ RBNZ OCR Review (26 January)
â€¢ NZ Weekly Forex Outlook (23 January)
â€¢ NZ Q4 CPI Review/OCR Preview (18 January)
â€¢ NZ Q4 QSBO Review (17 January)
â€¢ NZ Weekly Forex Outlook (16 January)
These papers/publications are available on Online Research on
Westpac Institutional Bankâ€™s website (www.wib.westpac.co.nz)
Westpac Banking Corporation ABN 33 007 457 141 incorporated in Australia (NZ division). Information current as at 24 May 2005. 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."