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4 Feb 2015
Market Movers: NZD helps drive AUD’s recovery – TDS
FXStreet (Barcelona) - The TD Securities Team shares the market performance in the Asian trade, noting that other than NZD and AUD, the FX space was fairly muted.
Key Quotes
“The NZD had a stellar run in our session up 1.2% and at day highs now (US$0.7435) following the strong dairy auction overnight and the RBNZ Governor embracing similar language to what the RBA used for all of last year suggesting a period of stability as more prudent. The market read that as ruling out the risk of rate cuts, that drove the NZD higher, but given the risk of outright deflation for at least the next two quarters TD published a change in view on the RBNZ calling for rates to be cut next month and in April.”
“The NZD rally helped to drive the recovery in the AUD, up US2c in the last 24 hours, +0.6% today to US$0.7835. Other than that, all other currencies traded 0.05% from NY close, so nothing in it.”
“The spike higher in US yields overnight reversed the drop in bond yields following the RBA cut yesterday (tactical trade ideas here), ACGB 3yrs +12bps to 1.92% and 10yrs 2.465% +18bps. The back up in NZGB yields was much more moderate, NZGB 3yrs +3.5bps, 10yrs +8.5bps."
"US 10yrs are 1bp higher in Asia at 1.80%.”
“Asian equities are piling on the gains in Asia, in a sea of green, Japan +1.8%, ASX +1.2%, but India and China are close to unchanged. The moves in commodities are fairly muted, nothing more to report.”
Key Quotes
“The NZD had a stellar run in our session up 1.2% and at day highs now (US$0.7435) following the strong dairy auction overnight and the RBNZ Governor embracing similar language to what the RBA used for all of last year suggesting a period of stability as more prudent. The market read that as ruling out the risk of rate cuts, that drove the NZD higher, but given the risk of outright deflation for at least the next two quarters TD published a change in view on the RBNZ calling for rates to be cut next month and in April.”
“The NZD rally helped to drive the recovery in the AUD, up US2c in the last 24 hours, +0.6% today to US$0.7835. Other than that, all other currencies traded 0.05% from NY close, so nothing in it.”
“The spike higher in US yields overnight reversed the drop in bond yields following the RBA cut yesterday (tactical trade ideas here), ACGB 3yrs +12bps to 1.92% and 10yrs 2.465% +18bps. The back up in NZGB yields was much more moderate, NZGB 3yrs +3.5bps, 10yrs +8.5bps."
"US 10yrs are 1bp higher in Asia at 1.80%.”
“Asian equities are piling on the gains in Asia, in a sea of green, Japan +1.8%, ASX +1.2%, but India and China are close to unchanged. The moves in commodities are fairly muted, nothing more to report.”