The Opening Bell: Where currencies start on Wednesday, September 13, 2017

By Dan Bell

The NZDUSD opens at 0.7284 (mid-rate) this morning.

The Kiwi was stronger than its major competitors except the GBP after a myriad of positive UK data releases overnight.

The U.K. Consumer Prices Index including owner occupiers’ housing costs 12 month inflation rate was 2.7% in August 2017, up from 2.6% in July 2017 and better than the 2.8% the market was expecting. The Consumer Prices Index (CPI) 12-month rate was 2.9% in August 2017, up from 2.6% in July 2017.

U.K. PPI Input was up 1.6% in August, ahead of the 1.2% expected and much better than the -0.2% from July. The annual rate of inflation for goods leaving the factory gate increased for the first time in 6 months in August 2017. Factory gate prices (output prices) rose 3.4% on the year to August 2017, up from 3.2% in July 2017. Prices for materials and fuels (input prices) rose 7.6% on the year to August 2017, up from 6.2% in July 2017, with the change in the rate being driven mainly by crude oil.

UK House prices grew by 5.1% in the year to July 2017, unchanged from the year to June 2017. The UK Property Transaction statistics showed that in July 2017 the number of seasonally adjusted property transactions completed in the UK with a value of £40,000 or above increased by 8.3% compared to July 2016. Comparing July 2017 to June 2017, property transactions increased by 1.3%.

The U.S. Index of Small Business Optimism rose 0.1 points to 105.3 in August, basically unchanged from July. Five of the 10 Index components posted a gain and five declined. The Index peaked for this recovery at 105.9 in January, just 0.6 points above the August reading.

Global equity markets are higher except the UK: Dow +0.21%, S&P500 +0.19%, FTSE -0.17%, DAX +0.40%, CAC +0.62%, Nikkei +1.18%, Shanghai +0.09%.

Gold prices are up $2 or 0.2% currently trading at $1,331 an ounce. WTI Crude Oil prices are modestly higher too, up 0.2% currently trading at $48.09 a barrel.

Current indicative rates:

NZDUSD       0.7284       0.6%
NZDEUR       0.6087       0.5%
NZDGBP       0.5481      -0.3%
NZDJPY         80.27        1.3%
NZDAUD       0.9087       0.7%
NZDCAD       0.8878       1.2%
GBPNZD       1.8238       0.3%

Upcoming Data releases (NZST):

  • 10:45am - NZD - FPI m/m
  • 12:30pm - AUD - Westpac Consumer Sentiment

 

 

 

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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »

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