HiFX Morning Update, May 8 2017

The NZDUSD opens at 0.6905 (mid-rate) this morning.

The NZD rallied on Friday, making steady gains against all its major rivals after Friday’s inflation expectations report showed New Zealand firms had raised their expectations for inflation over the next two years above 2% for the first time since 2015.

Strong jobs data out of the US on Friday was countered by disappointing wage growth. The non-farm payroll report showed employment surged by 211k jobs in April well ahead of the expected 185k increase. Although March’s 85k increase in jobs was downwardly revised to a 79k increase the unemployment rate edged down to a 10yr low of 4.4% in April from 4.5% in March. Economists had expected unemployment to increase to 4.6%.

As expected centrist candidate Emmanuel Macron has decisively won the French presidential election to become the youngest president in the country’s history. Earlier this morning the election results showed Mr Macron defeated far-right candidate Marine Le Pen by an estimated 65.5% to 34.5% majority.

There is very little in the way of local economic data until Thursday’s RBNZ Monetary Policy Statement. The RBNZ are expected to keep the OCR unchanged at 1.75%.

Global equity markets closed out the week broadly higher- Dow +0.26%, S&P 500 +0.40%, FTSE +0.68%, DAX +0.55%, CAC +1.12%, Nikkei +0.70%, Shanghai -0.788%.

Gold prices were down 3.3% over the course of the week closing on Friday at $1,227 an ounce .WTI Crude Oil rallied on Friday after it was reported that Saudi oil export loadings fell by more than 670,000 barrels a day in the month of April closing out the week at $46.22 a barrel.

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