if actual > forecast = good for currency (for AUD in our case)
[AUD - Home Loans] = Change in the number of new loans granted for owner-occupied homes. It's a leading indicator of demand in the housing market - most homes
are financed, so it provides an excellent gauge of how many qualified
buyers are entering the market.
The total number of home loans
in Australia was up a seasonally adjusted 0.3 percent on month in July,
the Australian Bureau of Statistics said on Tuesday - coming in at
forecasts for an increase of 1.0 percent, and down from the downwardly
revised 0.1 percent gain in June (originally 0.2 percent).
value of home loans for owner-occupied housing was flat on month at
A$17.058 billion - down from the 1.7 percent increase in the previous
Investment lending climbed 6.8 percent on year to A$11.513 billion, after adding 0.1 percent a month earlier.
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AminStar, 2014.09.09 22:09
Trading Video: FX Volatility Surge Puts Dollar and S&P 500 on Alert
if actual > forecast (or actual data) = good for currency (for AUD in our case)
- Home Loans] = Change in the level of a diffusion index based on surveyed consumers. Financial confidence is a leading indicator of consumer spending, which accounts for a majority of overall economic activity.
Bad time for Australia. Share market falls as consumer confidence drops
The Australian share market has suffered its worst fall in more than a
month, with investors influenced by losses on Wall Street and an
unexpected fall in consumer confidence.
All sectors fell but finance companies managed to post the slimmest losses.
The NAB and ANZ bank fell by 0.4 per cent and 0.25 per cent respectively, while the Commonwealth closed steady. Westpac gained 0.4 per cent.
The All Ordinaries index and the ASX200 both fell 34 points or 0.6 per cent to close at 5,574.
The mining sector
was one of the hardest hit; BHP Billiton dropped 0.8 per cent and Rio
Tinto 0.4 per cent, as the benchmark Chinese iron ore price softened a
touch more overnight Tuesday.
Atlas Iron dropped 4.2 per cent and Fortescue Metals Group fell 2.7 per cent, but gold miner Newcrest gained 1.25 per cent.
The Westpac Melbourne Institute Consumer Confidence index fell sharply and unexpectedly in its latest reading, erasing the gains it had made over the previous three months.
The index is now 4.6 points lower at 94, with any reading below 100 indicating that pessimists outnumber optimists.
Australian dollar was also hurt by the confidence index and continued
its slide on speculation that US interest rates will begin increasing
before those domestically.
Trading the News: Reserve Bank of New Zealand (RBNZ) Rate Decision (based on dailyfx article)
According to a Bloomberg News survey, all of the 13 economist polled see
the Reserve Bank of New Zealand (RBNZ) keeping the interest rate on
hold at 3.50%, but the fresh batch of central bank rhetoric may produce
increased volatility in the NZD/USD as market participants weigh the
outlook for monetary policy.
What’s Expected:Why Is This Event Important:
In light of the marked depreciation in the NZD/USD, the biggest risk for
surprise will be a removal of the verbal intervention on the kiwi, and a
further decline in the exchange rate may prompt Governor Graeme Wheeler
to adopt a more hawkish tone for monetary policy as it fuels imported
inflation.Below-target inflation along with the slowdown in employment may
encourage the RBNZ to retain a period of ‘interest rate stability’ in
New Zealand, and the fresh batch of central bank rhetoric may spur a
further decline in the NZD/USD should it drag on interest rate
expectations.Nevertheless, the RBNZ may no longer jawbone the kiwi as the lower
exchange rate raises the risk for imported inflation, and the NZD/USD
may face a more meaningful rebound ahead of the next Fed meeting on
September 17 should Governor Wheeler unexpectedly adopt a more hawkish
tone for monetary policy.
How To Trade This Event Risk
Bearish NZD Trade: RBNZ Continues Talk Down Interest Rate Expectations
MetaTrader Trading Platform Screenshots
NZDUSD, M5, 2014.09.11
MetaQuotes Software Corp., MetaTrader 5, Demo
NZDUSD M5 : 35 pips price movement by NZD - Official Cash Rate news event
AUDUSD Technical Analysis (based on dailyfx article)
Technical Analysis: AUDUSD & NZDUSD trade similarly for different reasons
The NZDUSD made new lows on the back of comments from RBNZ’s Wheeler who said that the currency was overvalued and that rates would stay on hold until 1Q of 2015. Meanwhile in Australia, the AUDUSD made it’s new move lows despite much stronger employment statistics that had the market questioning the seasonals.
EURUSD Fundamentals (based on dailyfx article)
Euro selling pressure appears to be waning at last after eight consecutive weeks of losses that brought the single currency to the lowest level in 14 months against the US Dollar.
The operative question going forward is whether this precedes a period
of consolidation before a reinvigorated push downward or a correction
upward. The answer will be found in the markets’ response to a hefty
dose of high-profile event risk on the domestic and the external fronts
in the week ahead.
Looking inward, thespotlight is on the first ECB TLTRO operation due to be held on September 18.
The effort represents one of many easing tools that Mario Draghi and
company have deployed in recent months in an attempt to check the slide
toward deflation and repair the seemingly broken monetary policy
transmission mechanism that has made the central bank’s prior attempts
at stimulus largely ineffective. The scheme envisions offering Eurozone
banks cheap capital tied up with conditions pushing them re-lend it
while passing on low borrowing costs to the real economy, stoking
activity and boosting prices. The key variable in play will be the
size of the liquidity provision that is ultimately taken up by banks
tapping the facility. In a somewhat counter-intuitive turn of events, a
large capital allocation seems likely to offer support to the Euro.
Externally, the first major item of note is the FOMC policy
announcement. September’s outing will be accompanied by the release of
an updated set of forecasts for key metrics of US economic activity as
well as press conference from Chair Janet Yellen. The Fed has long
warned about complacently buoyant risk appetite as the end of QE3 looms
ahead next month. If policymakers opt to shake things loose with
upbeat activity projections and/or a hawkish outing from Ms Yellen,
this may put the Euro’s increasingly unattractive yield profile in
stark relief and reinvigorate bearish momentum.
The second is the Scottish Independence referendum. Opinion polls ahead
of the ballot essentially point to a 50/50 chance that Scotland will
secede from the UK. This implies that – whatever the final result – a
surge of volatility is likely to follow the results as those on the
wrong side of the outcome are forced to readjust positions. A final
vote in favor of independence is likely weigh on Sterling, sending
capital fleeing to alternatives. The Euro looks like a natural
beneficiary in such a scenario. Needless to say, a victory for the “no”
campaign will probably yield the opposite result.