The Opening Bell: Where currencies start on Monday, September 11, 2017

By Dan Bell

The NZDUSD opens at 0.7271 (mid-rate) this morning.

The Kiwi is up against all the G10 currencies from Friday’s open. The NZDUSD rallied over 110 points during the day on Friday but fell 60 odd points in the US session overnight Friday.

Britain’s efforts to expand trade in goods beyond the European Union’s border took a knock in July after official figures showed the deficit with the rest of the world widened following a drop in exports. The deficit in the trade in goods with non-EU countries widened by £2.4bn while exports to the EU grew to cut the trade gap by £1.3bn.

Analysts had expected the fall in the pound to give a significant boost to exports with the EU and beyond, but the trend since last year’s Brexit vote has shown only a gentle increase in exports and a continuing appetite for imports, despite the higher cost.

In the 3 months to July 2017, the U.K. Index of Production was estimated to have increased by 0.3% compared with the 3 months to April 2017, due mainly to a rise of 2.2% in mining and quarrying. The largest contribution to the rise in mining and quarrying in the 3 months to July 2017 came from oil and gas extraction, which rose by 2.6%.

Canadian Employment was little changed in August (+22,000 or +0.1%). The unemployment rate declined by 0.1% to 6.2%, matching the most recent low of October 2008, the month prior to the 2008-2009 labour-market downturn.

U.S. wholesale inventories rose 0.6% in July, matching the rise in each of the previous two months, as stocks for a variety of goods, including autos, posted gains. Construction output also fell month-on-month, falling by 0.9% in July 2017, and contracted by 1.2% compared with the same 3 months in 2016. Consumer Credit rose to 18.5 Billion from 11.5 Billion.

China’s consumer inflation rose to a seven-month high by 1.8% in August from a year earlier, compared with a 1.4% gain in July. The producer-price index climbed 6.3% in August compared with a 5.5% on-year increase in July. The PPI increased 0.9% in August from a month earlier.

Global equity markets are mixed: Dow +0.06%, S&P500-0.05%, FTSE -0.26%, DAX +0.06%, CAC +0.00%, Nikkei +0.63%, Shanghai -0.01%.

Gold prices are steady currently trading at $1,346 an ounce. WTI Crude Oil prices are down 0.1% currently trading at $49.07 a barrel.

Current indicative rates:

NZDUSD       0.7271       0.6%
NZDEUR       0.6051       0.7%
NZDGBP       0.5522       0.1%
NZDJPY         78.91        0.7%
NZDAUD       0.9008       0.3%
NZDCAD       0.8842       0.9%
GBPNZD       1.8109      -0.1%

 


 

 

 

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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »

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