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Collinson FX Commentary: Jan 23 - NZD regains .7300

by Collinson FX 24 Jan 02:10 NZDT 24 January 2018


Collinson FX Commentary: Jan 23 - NZD regains .7300

US Markets remain consumed by the Government shutdown. This is the third day of the shutdown and politicians fight to apportion blame. The strategy from the Democrats is to close down the Government, while seeking to blame Trump and the Republicans, all the time holding out for an immigration victory.

A compromise is likely to eventuate sooner, rather than later, with little or no damage. The stock markets shrugged this off and continued to build on the bull run. US Bonds remain well bid and the Dollar soft. The EUR traded 1.2220, ahead of the ECB rate decision, while the GBP moved up to 1.3930. The actions of the Bank of Japan is much anticipated, with a return to a more normalised monetary policy expected, as the JPY blew back above 111.00.

Commodity currencies are enjoying a special run, with a weaker reserve and strong demand, allowing rallies beyond what their own economic realities dictate.

The NZD regained 0.7300, overnight, while the AUD continued to trade around 0.8000. Local PMI data and confidence numbers may drive early trade, although Central Bank action/speculation and economic data revelations offshore, remain the major influence.

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