Today’s Commentary
The NZD opens strongly this morning after sour news on the US job front failed to drag down sentiment levels over the weekend.
The Friday session had been positive for the Kiwi after the RBA released a very bullish statement on monetary policy. The banks forecasts now call for Australia to grow 1.75% this year and 3.25% over 2010. The numbers are about three times higher than in the last update and the news locked in expectations for another 0.25% increase in interest rates next month.
Over US trading hours the Bureau of Labor Statistics announced the US economy lost 190,000 jobs in October taking the unemployment rate to 10.2%, a level not seen for the last twenty six and a half years. Analysts quickly pointed to the data as a reason for pessimism over consumer confidence and spending levels. Barack Obama who had already announced an extension to the jobless benefits period tried to calm nerves saying he was considering a range of options to encourage growth.
Despite the initial volatility after the release bulls defended their positions and equity markets actually finished up for the day. The S&P 500 index added 0.25% to its value and in the UK the FTSE had a similar result later that evening. The NZD/USD now sits within striking distance of its high for the month to date.
Upcoming Announcements:
- 09 November 09: NZ QV House sales
- 09 november 09: AU Housing finance
- 09 November 09: GE Trade balance
- 10 November 09: AU NAB Bus confidence
- 10 November 09: GE ZEW survey
By Sam Spink - McCarthy, Corporate Dealer
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