Aussie Dollar Soars as RBA Withholds Rate Cut, NZ Dollar Gains on Data

DailyFX.com -

Talking Points:

• Aussie Dollar Soars After RBA Unexpectedly Leaves Rates Unchanged

• NZ Dollar Higher on Upbeat Commodity Exports, House Price Figures

• British Pound May Not Find Support in Upbeat Construction PMI Data

The Australian Dollar outperformed in overnight trade, rising as much as 0.7 percent on average against its leading counterparts, after the RBA unexpected opted not to cut interest rates again at today’s monetary policy meeting. Economists were projecting a 25bps reduction while priced-in expectations reflected the implied probability of further easing at 60 percent. RBA Governor Glenn Stevens left the door open to future stimulus expansion however, saying the central bank will “assess the case for such action at forthcoming meetings”.

The New Zealand Dollar likewise advanced, finding support in upbeat economic news-flow. ANZ Commodity Price Index figures showed the price of the island nation’s raw-material exports jumped 1.8 percent in February, marking the largest increase since April 2013. That helped boost the outlook for the pivotal external sector, which accounts for close to 30 percent of GDP. Separately, the QV House Price gauge rose for a second consecutive month, posting the largest gain in five months. Meanwhile, the Yen traded higher as a drop on Japan’s benchmark Nikkei 225 stock index fueled demand for the safe-haven currency.

The economic calendar is relatively quiet in European trading hours. UK Construction PMI figures are expected to show the pace of homebuilding sector activity growth narrowly slowed in February. UK economic news-flow has outperformed relative to consensus forecasts over recent weeks, opening the door for an upside surprise. A similar outcome on the Manufacturing PMI print failed to drive the British Pound higher yesterday however, warning the currency may likewise look past today’s report. Elsewhere, the fourth-quarter Swiss GDP data is due to show output expanded 0.3 percent, marking a slowdown from the 0.6 percent expansion registered in the three months through September.

New to FX? START HERE!

Asia Session

GMT	CCY	EVENT	ACT	EXP	PREV
22:30	AUD	ANZ Roy Morgan Weekly Consumer Conf	112.5	-	110.8
23:00	NZD	QV House Prices (YoY) (FEB)	6.4%	-	5.7%
23:50	JPY	Monetary Base (YoY) (FEB)	36.7%	-	37.4%
23:50	JPY	Monetary Base - End of Period (¥) (FEB)	278.9T	-	278.6T
23:50	JPY	Loans & Discounts Corp (YoY) (JAN)	2.9%	-	3.1%
0:00	NZD	ANZ Commodity Price (FEB)	1.8%	-	1.0%
0:30	AUD	BoP Current Account Balance (4Q)	-9.6B	-11.0B	-12.1B
0:30	AUD	Net Exports of GDP (4Q)	0.7	0.6	0.8
0:30	AUD	Building Approvals (MoM) (JAN)	7.9%	-2.0%	-2.8%
0:30	AUD	Building Approvals (YoY) (JAN)	9.1%	-1.7%	9.6%
1:30	JPY	Labor Cash Earnings (YoY) (JAN)	1.3%	0.5%	1.3%
1:30	JPY	Real Cash Earnings (YoY) (JAN)	-1.5%	-	-1.7%
3:30	AUD	RBA Interest Rate Decision	2.25%	2.00%	2.25%

European Session

GMT	CCY	EVENT	EXP	PREV	IMPACT
6:45	CHF	GDP (QoQ) (4Q)	0.3%	0.6%	Medium
6:45	CHF	GDP (YoY) (4Q)	1.7%	1.9%	Medium
7:00	EUR	German Retail Sales (MoM) (JAN)	0.4%	0.6%	Low
7:00	EUR	German Retail Sales (YoY) (JAN)	3.0%	4.8%	Low
9:30	GBP	Markit/CIPS UK Construction PMI (FEB)	59.0	59.1	Medium
10:00	EUR	PPI (MoM) (JAN)	-0.7%	-1.0%	Low
10:00	EUR	PPI (YoY) (JAN)	-3.0%	-2.7%	Low
10:00	GBP	BOE's Carney Speaks on FX Probe	-	-	Low

Critical Levels

CCY	Supp 3	Supp 2	Supp 1	Pivot Point	Res 1	Res 2	Res 3
EURUSD	1.1033	1.1114	1.1149	1.1195	1.1230	1.1276	1.1357
GBPUSD	1.5193	1.5291	1.5329	1.5389	1.5427	1.5487	1.5585

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

To receive Ilya's analysis directly via email, please SIGN UP HERE

Contact and follow Ilya on Twitter: @IlyaSpivak

original source

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
Learn forex trading with a free practice account and trading charts from FXCM.