NZD - New Zealand Dollar
Risk had a good night with equities higher across the board, the S&P 500 forging another all-time high in the process. Rates markets were largely flat and another risk barometer USDJPY was higher but commodity currencies such as the NZD failed to follow suit. NZDUSD opens this morning once again stuck near the 64-cent handle, in the middle of narrow monthly range (0.6322 – 0.6466).
This morning we had New Zealand Retail Sales for Q3 (excluding inflation) rise 1.6% (vs exp of 0.5%). “Higher electronic sales volumes in the quarter coincided with some retailers promoting sales of big screen televisions before the Rugby World Cup in Japan, which started near the end of September,” retail statistics manager Sue Chapman said.
Key levels of intra-day support to watch for NZDUSD are 0.6378 (Daily Fibonacci 23.6%) and 0.6347 (50-Day Moving Average). Resistance sits at 0.6426 (100-Day Moving Average) and 0.6486 (Daily Fibonacci 38.2%). AUDNZD continues to cross back and forth above significant support being the 200-Day Moving Average at 1.0570, currently at 1.0560-70.
Looking further ahead the RBNZ Financial Stability Report (Wednesday) will show the level of resilience the financial system is enjoying before the bank publishes the final decisions on its Capital Review for banks on December 5th.
A quiet night in the U.S. session overall for FX, with the US Dollar Index climbing higher on the back of reports that China is planning to raise penalties on intellectual property violations. Other than that, headlines were light with China summoning the U.S. Ambassador to complain about the recent Hong Kong Bill passed through the senate (yet to be signed officially by Trump). Market reaction to the downside was limited on the headline with U.S. equities outperforming and U.S. Treasury yields dipping.
Earlier on in the Europe Session, EURUSD continues to disappoint bulls and bears, with the French and German PMI’s a beat (although from very low levels), but the Eurozone services a miss. This saw price action briefly rally and reach the highs on the day, with the rally topping out at 1.1030, sitting now at 1.1010. 1.0990 for now remains short term support and if we close below 1.1000 on the break of it, we may see further follow through on a USD flow driven month end.
New ECB president Christine Lagarde spoke at the end of last week, with nothing market moving, and we have more speakers this week in form of ECB’s Philip lane, Yves Mersch, Benoît Coeure as well as U.S. Fed’s Chairmen Jerome Powell and Lael Brainard.
0.6375 - 0.6465 ▼NZD/EUR:
0.5800 - 0.5850 ▼GBP/NZD:
2.0025 – 2.0200 ▲NZD/AUD:
0.9435 - 0.9480 ▲NZD/CAD:
0.8465 - 0.8570 ▼