NZD: NZD/USD Erases Tuesday's Gains, Falls Below 20-Day EMA
Feb-12 21:54
- NZD/USD erased Tuesday's gains to closed down 0.25% at 0.5640. The pair briefly sold off as US CPI came in stronger-than-expected, we touched 0.5600 before a quick reversal to end up right back at the levels prior to the data release, US yields rose 8-9bps. Trump has been talking to Putin, where he mentioned the leaders agreed to begin talks on ending the war in Ukraine, which has seen some support for high beta currencies, the JPY dropped and is the worst performing currency following those headlines.
- We now trade below the 20-day EMA, initial support is at 0.5600 (Feb 12 lows). To the upside, key resistance is seen at 0.5697 (50-day EMA).
- US CPI came in at 3% vs 2.9% y/y expected, m/m was 0.5% vs 0.3% expected. The higher-than-expected M/M core / supercore CPI readings reflected stronger pressures in all major sub-categories in January.
- New Zealand Treasury reported an operating deficit of NZ$3.50b for the six months to Dec 31, NZ$384m narrower than the December forecast. Core Crown tax revenue exceeded projections by NZ$229m, with sales tax ~NZ$300m above forecast due to stronger consumption and residential investment. Net core Crown debt stood at 44.1% of GDP, slightly below the 44.2% projection. The OBEGAL deficit was NZ$4.57b, NZ$307m narrower than expected.
- No large nearby strikes Thurs. Upcoming notable strikes: 0.5550 (NZD350.9m Feb. 18), 0.5580 (NZD308.9m Feb. 14)
- RBNZ dated OIS pricing is holding steady across the next few meeting, The market is pricing in a 88% chance of a 50bps cut for Feb, another 25bps cut priced for April.
- Later today we have 2Yr Inflation Expectation, while the market will likely turn its attention to US PPI later tonight.
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AUD: A$ Stabilizes With Equity Sentiment, Westpac Consumer Sentiment Today
Jan-13 21:28
AUD/USD tracks near 0.6160/65 in early Tuesday dealings, after rising close to 0.25% for Monday's session. Broader USD trends were mixed with EU currencies still seeing weakness (albeit up from lows), while commodity related FX did slightly better. The USD BBDXY index didn't shift much, last near 1320.
- FX risk sentiment stabilized as we progressed through the US session. EU equities moved up from session lows, but still finished weaker (off close to 0.50%). US equity markets were mixed, the SPX rising 0.16%, but Nasdaq off 0.38%.
- AUD/USD steadily recovered from fresh cycle lows (0.6131) to current levels. Technical sentiment remains bearish with focus on downside round figure support at 0.6100. Initial firm resistance to monitor is 0.6247, 20-day EMA. The 50-day EMA is at 0.6365.
- More action was evident in USD/JPY, with this pair supported sub 157.00, to be back around 157.70 in latest dealings. AUD/JPY sits back around 97.15/20 in latest dealings, against intra-session lows on Monday of 96.38.
- US yields mostly stayed on the front foot, around 2-4bps firmer across the key benchmarks, although there was limited data out overnight. NY Fed 1yr inflation expectations were steady, but longer dated expectations were mixed.
- In the commodity space, the Bloomberg aggregate index rose a further 0.55%, the metals index a further 0.38% firmer (its 6th straight gain).
- Locally today we have the Westpac consumer sentiment reading on tap.
ASIA: Coming Up In The Asian Session On Tuesday
Jan-13 21:21
| 0345GMT | 1145HKT | 1445AEDT | Thailand Dec Consumer Confidence |
| 0630GMT | 1430HKT | 1730AEDT | India Dec Wholesale Prices |
ASIA: Coming Up In The Asia-Pac Session On Tuesday
Jan-13 21:17
| 2330GMT | 0730HKT | 1030AEDT | Australia Jan Westpac Consumer Conf |
| 2350GMT | 0750HKT | 1050AEDT | Japan Nov BoP Current Account Balance |
| 2350GMT | 0750HKT | 1050AEDT | Japan Nov Trade Balance BoP Basis |
| 2350GMT | 0750HKT | 1050AEDT | Japan Dec Bank Lending |
| 0100GMT | 0900HKT | 1200AEDT | Japan BOJ Deputy Governor Himino Speech |
| 0135GMT | 0935HKT | 1235AEDT | EU ECB's Rehn Keynote Speech |
| 0335GMT | 1135HKT | 1435AEST | South Korea Nov Money Supply |
| 0500GMT | 1300HKT | 1600AEST | Japan to Sell 5-Year Bonds |
| 0830GMT | 1630HKT | 1930AEST | Japan Dec Eco Watchers Survey |
