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Forex & Equities: NZ Employment Surges & Session Ranges

Posted by Akhilesh Ganti on May 6, 2014 10:51:00 PM

New Zealand's Employment report for the first quarter of 2014 reinforced the RBNZ's decision to embark on a tightening policy as it posted a +0.9% exceeding market estimates of +0.6%. The jobless rate remained at +6% which was higher than the +5.8% forecast but the record rise in the participation rate should offset the usual negative implications of such a result.

This data coupled with the lift in business confidence suggests that inflationary pressures should accelerate in the coming quarters and leave the RBNZ with no recourse but to keep raising rates. The Kiwi actually sold off on this as Governor Wheeler brought out the only weapon they have to counter a stronger currency... the threat of "intervention".

BOJ minutes for the April 7/8 meeting were released today and they showed that the decision to leave the policy target unchanged was an unanimous one. Australia's Retail Sales for March posted a gain of +0.1%, much lower than the +0.4% estimate. The first "risk event" for the week is on tap for today as FED Chairperson, Janet Yellen, is scheduled to testify before Congress.

Ranges:{WWM's New ALPHA Trader-4 HOUR charts [EUR, GBP, AUD, YEN, GOLD, OIL, DXY]}(click to enlarge)

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Equities:{WWM's New ALPHA Trader-4 HOUR charts [Dow30, SP500, Nasdaq100, Japan225, China, Nifty50, FTSE100, ASX200]}(click to enlarge)

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