FX News

FX Update: Global Risks Sinks Kiwi

Market Overview

Key Points:

Australian House Prices are poised to significantly drop in value as a recent household survey of household spending suggested home buying fell by 3.8% in April
Biden has said he is worried Putin doesn’t have a way out of the war in Ukraine
Chinese economic risks are rising with its ties to Russia during the Ukraine war
US consumers have expressed concerns about US housing affordability- Fannie Mae’s Home Purchase Sentiment Index decreased 4.7 points to 68.5 in April
Vice chair of the Federal Reserve Clarida suggests the Fed will need to raise rates to at least 3.5% to bring down inflation back to around 2.0%
Fed one year inflation expectations 6.3% vs 6.6% in March
The ECB will probably raise rates and start a tightening cycle in June
The Japanese Yen (JPY) is the strongest currency this week with the Australian Dollar (AUD) the weakest.
ANZ Truckometer Index for light traffic rose 8.3% in April while heavy traffic rose 2.3%

Major Announcements last week:
US ISM Manufacturing 55.vs 57.5 forecast for April
RBA raises Cash Rate to 0.35% from 0.10%
NZ Unemployment Rate published bang on expectation at 3.2%
Federal Reserve raises Cash Rate to 1.0% from 0.50%
Bank of England (BoE) raises Bank Rate to 1.0% from 0.75%
US Non Farm Payroll 428k vs 390k expectation
US Unemployment Rate 3.6% vs 3.5% expected for April

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