Weekly Market Commentary
Sentiment took a dive at the close of trading of the trade week. The trade impasse is translating into actual economic data coming out of China. Chinese Industrial Production and Retail Sales were softer in China, providing an incentive for Chinese political leaders to facilitate a trade compromise. The Chinese are moving towards significantly increasing imports of US Soya Beans and Corn, while reducing tariffs on US cars. Positive moves have given markets reason for hope but economic data is starting to reflect the weaker economic growth narrative.
European markets remain locked in Brexit chaos, while 'Yellow Vest' protests spread across France and Europe. The Geo-Politcal situation is deteriorating across Europe and starting to impact the economic environment. The EUR slipped back below 1.1300, while the GBP slumped to 1.2570. The significance of these political demonstrations cannot be underestimated.
Chinese demand and the trade wars negatively impact the trade exposed commodity currencies. The NZD dropped back to 0.6800, while the AUD fell to 0.7175, reflecting global trade and growth fears. The coming week will be highlighted by Central Banks with rate decisions from the Fed, Bank of England and the Bank of Japan. Growth data will be in the spotlight with GDP numbers from the USA, NZ and the U.K.. Local NZ Business Confidence has been a market mover this year, so this number will be keenly watched, while Australian employment data will be key to local markets
Weekly Market Calendar
17/12 NZ Consumer Confidence, NZ Dairy Auction, U.K. House Prices, EU Trade, EU CPI, Empire State Manufacturing, NAHB House Price Index
18/12 Australia Consumer Confidence, NZ Business Confidence, RBA Minutes, German IFO Business Climate, US Housing Starts, US Building Permits
19/12 NZ Current Account/GDP, Japan Trade Exports/Imports, German PPI, Japan CPI, UK House Price Index, US Weekly Mortgage Applications, US Current Account, US Existing Home Sales, FOMC Meeting and press conference
20/12 NZ Trade Exports/Imports, NZ GDP, Bank of Japan Rate Decision, Australia Employment, NZ Credit Card Spending, EU Current Account, Bank of England Rate Decision, UK Retail Sales, Philly Fed Survey, US Weekly Jobless Claims
21/12 NZ Consumer Confidence, Japan CPI, German Consumer Confidence, France GDP, UK Current Account, UK GDP, US GDP, US Durable Goods Orders, US Personal Income/Spending, University of Michigan Sentiment
Paul Bettany
Collinson & Co
0406-744-923
paul@collinsonfx.com