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A few notes on AUD and the Australian economy

The Australian dollar peaked in the early beginning of 2012 at the level of 1.11 USD. After almost two years of consolidation between in the range between 0.97 and 1.08 the trend down commenced in the spring of 2013. This development is rather befuddling, especially when compared to NZD that stayed in bullish mode over the same period of time. Considering that both currencies have the highest yields among developed nations such unusual dynamics for AUD is noticeable.
It looks that the AUD is go…
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The Australian Dollar – The Trend Might Continue

The Reserve Bank of Australia kept the rates unchanged at 2.5% earlier this morning. In the accompanying statement the bank officials duly noted that the period of prolonged low interest rates is not over yet, albeit further rate cuts are not coming soon either.
The market seemed rather perplexed by these emanations – AUD spiked for a few minutes only to go down for the rest of the day. Indeed, the market participants still remember that according to “fundamentals” the “fair value” for AUD is 0…
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The British Pound – The Trend Down is Intact

Among a few tools of monetary policy, available to any central bank, the verbal stance on the current state of economy and financial system is the finest. Markets are desperately waiting for any signals, foreshadowing the forthcoming changes in interest rates or liquidity programs. Every statement, emanating from the the central bank, is thoroughly parsed and analyzed. The minutes, released on regular basis by BoE is not an exception.
On November the 19th BoE England Minutes were made public. T…
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NFP data and interest rates expectations

Much anticipated NFP data release came out last Friday – the numbers fell short of expectations and previous report, only 209K jobs were created over the last month vs. 288K in June while averaged level of expectations was 233K.
Albeit at the surface data was not devastatingly bad, at the slightly closer examination the report clearly demonstrates the dolldrums the US labor market is in – the average hourly compensation stagnates if accounted for CPI numbers (the former is up 0.2% MoM while the…
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Employment Cost Index, Interest Rate Expectations and Stock Market Swoon

This last week was repleted with important and having lasting influence data releases. Although the most anticipated and looked for by investors was Non-Farm Payroll Change, published on Friday, its impact on stock market was more than limited. What passed almost inconspicuously to most market participants and observers of different stripes but had significant influence on financial markets was release of Employment Cost Index last Thursday.
The importance of this data is difficult to overestim…
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Employment Cost Index, Interest Rate Expectations and Stock Market Swoon

This last week was repleted with important and having lasting influence data releases. Although the most anticipated and looked for by investors was Non-Farm Payroll Change, published on Friday, its impact on stock market was more than limited. What passed almost inconspicuously to most market participants and observers of different stripes but had significant influence on financial markets was release of Employment Cost Index last Thursday.
The importance of this data is difficult to overestim…
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orto leave comments