Daily Market Commentary
The important Non-Farm Payrolls missed expectations and the equity markets took this as a bad sign, with equities selling off sharply, to end a bad week. Market confidence has been popped again, and the weak labour market raises fears of a potential economic slow-down, in the USA. This is exactly the problem that triggered market corrections at the beginning of August. Depressed manufacturing conditions prevail across most of Europe and the USA. Consumer demand has also been weak, so expect the ECB to make further stimulative rate cuts, in the coming week. The pressure is on the Fed to also make rate cuts, even to the tune of, 50 basis points. Risk appetite was crushed and the safety of the US Dollar was sought, with the EUR falling to 1.1070, while the GBP fall back towards 1.3100.
Market sentiment slipped and the rising reserve hit commodity currencies hard, with the AUD dropping to 0.6660, while the NZD plunged back below 0.6200. This coming week will focus on growth, trade and inflation. Inflation readings in Germany and the US will be closely monitored, while the ECB is expected to cut interest rates further.
Weekly Market Commentary
9/9 Japan Current Account/GDP/Trade, China CPI/PPI, NZ Manufacturing Sales
10/9 Australia Consumer/Business Confidence, China Trade Exports/Imports, German CPI, UK Employment, NFIB Small Business Optimism
11/9 UK Trade/GDP, UK Industrial/Manufacturing Production, US Weekly Mortgage Applications, US CPI, NZ Credit Card Spending, NZ Food Price Inflation
12/9 ECB Interest Rate Decision, German Current Account, US Weekly Jobless Claims, US PPI, NZ Business PMI
13/9 Japan Industrial Production, France CPI, EU Industrial Production, University of Michigan Economic Sentiment
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