Kiwi retreats from one-month high

Kiwi hit by consumer confidence

The New Zealand dollar, this week’s surprise out-runner, retreated from the highest level in more than a month this morning after data showed consumer confidence fell to a three-year low in October, according to an ANZ gauge. The kiwi is still the best G-10 performer versus the dollar this week after it posted gains of about 2.1% yesterday, the most since July 2016. NZD/USD is currently testing 100-day moving average resistance at 0.6667.

NZD/USD Daily Chart

Source: OANDA fxTrade

Australia retail sales miss estimate

Retail sales during September rose just 0.2% m/m, missing economists’ estimates of a 0.4% gain, but still held at zero or above for the ninth straight month. The softer number, combined with a mild uptick in the US dollar, saw AUD/USD ease back from one-month highs to 0.7201.

What a difference a week makes

After struggling with its worst monthly performance in a decade in October, the US30 index is today facing its biggest weekly gain since June, while the SPX500 index has the chance to record the largest weekly advance since March.

Dollar Stumbles Awaiting US Jobs Report

On the currency front, the dollar index, a measure of the greenback’s value against six major currencies, fell the most since June 29 yesterday, as rising stocks and positive vibes on the US-China trade dispute boosted risk appetite. This meant that this morning’s yuan fix was firmer for the first time since Monday, with USD/CNH trading down to its lowest level in more than two weeks.

USD/CNH Daily Chart

Source: OANDA fxTrade

Non farm payrolls in the spotlight

Activity in Asia was relatively mundane as traders await the release of the US October payroll report this evening. Latest surveys suggest the US economy added 190,000 jobs, a sharp increase from September’s weather-affected 134,000, but below the six-month average of 203,000. The unemployment rate is expected to remain at near-50 year lows of 3.7%, while average hourly earnings are seen rising 3.1% y/y. That would be the fastest pace of wage gains since 2009, and would cement the Fed’s current hawkish rate path.

Ahead of the US events, Markit manufacturing PMIs from Germany and the Euro-zone for October are seen unchanged from 52.3 and 52.1 respectively from prior months. In the shadow of the US payrolls we get to see Canada’s own October jobs report and trade data for September.

The full MarketPulse data calendar can be viewed at https://www.marketpulse.com/economic-events/

Have a great weekend from Asia.

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