Everest Fortune Group | Daily Analysis: 7 June 2019
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Daily Analysis: 7 June 2019

Daily Analysis: 7 June 2019

NZD

 

Fundamental Analysis

(7th June): Today NZD has a light data print day while China is on holiday today. NZD is likely to trade sideways or slightly in a negative territory due to the market is pricing in more rate cuts as its Trans-Tasman counterparty has opened the floor for more rate cut. Meanwhile, China has tremendous room to adjust monetary policy if the trade war with the U.S. deepens, according to People’s Bank of China governor Yi Gang. This could ease off market’s concern over the slowdown of the world’s second-largest economy. NZD is likely to edge up upon the news.

 

 

(6 June): RBA’s Lowe strongly suggested he could follow up Tuesday’s rate cut with another one as he seeks to drive down unemployment and revive inflation. He mentions that the board has not yet made a decision, but it is not unreasonable to expect a lower cash rate.

 

 

(4 June): US data, on Monday,  surprised to the downside, as the Markit Manufacturing PMI resulted at 49.1 in May, below the preliminary estimate of 49.7. Furthermore, the official ISM Index printed 52.1, well below the 53.0 expected and the lowest since October 2016. Economic activity expanded at a slower than expected pace, fueling speculation of a possible rate cut in the US. Concerns were exacerbated by Fed’s Bullard, who said that a rate cut might be warranted soon amid trade and inflation risks. The central bank is scheduled to meet next week.

 

 

(3 June): Pound extended its decline last week as May’s resignation opens up the prospects of no-deal Brexit with Nigel Farage’s Brexit party leading the first wave of win in the general election. Elsewhere, Gilts dipped as BOE Deputy Governor Dave Ramsden indicated possibility of a rate hike should Brexit goes smoothly but pared those gains later in the day. Optimism for the currency remains dim as the currency held steady before dipping despite Speaker of the House John Bercow assurance that the Parliament can prevent a no-deal Brexit.

 

 

 

 

 

 

 

 

 

Technical Analysis

USD

Fundamental Analysis

(7th June) Today NZD has a light data print day while China is on holiday today. NZD is likely to trade sideways or slightly in a negative territory due to the market is pricing in more rate cuts as its Trans-Tasman counterparty has opened the floor for more rate cut. Meanwhile, China has tremendous room to adjust monetary policy if the trade war with the U.S. deepens, according to People’s Bank of China governor Yi Gang. This could ease off market’s concern over the slowdown of the world’s second-largest economy. NZD is likely to edge up upon the news.

 

 

(6 June): RBA’s Lowe strongly suggested he could follow up Tuesday’s rate cut with another one as he seeks to drive down unemployment and revive inflation. He mentions that the board has not yet made a decision, but it is not unreasonable to expect a lower cash rate.

 

 

(4 June): US data, on Monday,  surprised to the downside, as the Markit Manufacturing PMI resulted at 49.1 in May, below the preliminary estimate of 49.7. Furthermore, the official ISM Index printed 52.1, well below the 53.0 expected and the lowest since October 2016. Economic activity expanded at a slower than expected pace, fueling speculation of a possible rate cut in the US. Concerns were exacerbated by Fed’s Bullard, who said that a rate cut might be warranted soon amid trade and inflation risks. The central bank is scheduled to meet next week.

 

 

(3 June): Pound extended its decline last week as May’s resignation opens up the prospects of no-deal Brexit with Nigel Farage’s Brexit party leading the first wave of win in the general election. Elsewhere, Gilts dipped as BOE Deputy Governor Dave Ramsden indicated possibility of a rate hike should Brexit goes smoothly but pared those gains later in the day. Optimism for the currency remains dim as the currency held steady before dipping despite Speaker of the House John Bercow assurance that the Parliament can prevent a no-deal Brexit. … 

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