HIFX Morning Update, September 12 2016

HIFX Morning Update, September 12 2016

NZDUSD 0.7320 -0.9%
NZDEUR 0.6510 -0.8%
NZDGBP 0.5515 -0.7%
NZDJPY 75.12 -0.8%
NZDAUD 0.9705 0.4%
NZDCAD 0.9550 0.0%

The NZD opens lower this week, at 0.7320 . A nearly one percent fall since opening on Friday.

Hawkish comments from Boston’s Federal Reserve President, increased concerns of an interest rate hike sooner than the market currently expects.
The comments suggested a gradual tightening of monetary policy is likely to be appropriate to ensure the US economy remains at the full employment level.
These comments have spooked the market somewhat, with a Senior UBS Bank director suggesting that a US Interest rate increase on 22 September (NZT) would be “dangerous” and could cause a significant “market shock”.
Market pricing now sees a 30% chance of a rate hike this month from the Fed.

Global Equities have had their sharpest decline since June’s Brexit fallout. Central bank policies of both the Eurozone and the U.S are continuing to lead market sentiment.

Domestically, all eyes will be on Thursday’s Quarterly GDP data.

Oil prices lost virtually all their gains from Thursday as supply concerns eased. Previously, Oil production in the Gulf of Mexico was cut up to 22% prior to the recent storms. Market observers now expect supplies to rebound strongly in coming weeks.

WTI Crude Oil is now $45.88 a barrel (down 4.2%) Gold prices down .7% at $1327 an ounce.

Most Global equity markets are lower : - Dow -2.13%, S&P 500 -2.45%, FTSE -1.19%, DAX -.95%, CAC -1.12%, Nikkei +0.04%, Shanghai -.55%.

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