FX News

Risk off Drives Kiwi Lower

Market Overview

Key Points:

• Worldwide coronavirus cases surpass 266.565 million with over 5.275 million official deaths.
• New Zealand has 6350 active cases of coronavirus with 136 new cases today and 0 deaths. Meanwhile, the Australian State of New South Wales reported 208 new cases and 0 deaths yesterday with Victoria reporting 1073 new cases with 6 deaths
• RBNZ deputy governor expects the unemployment rate to drift up to 4.0%
• Bank of England’s Broadbent said he is unsure of how omicron will affect his interest rate decisions with no clear answers at the moment
• 3 reasons why we may see an improvement this week in risk- omicron may be less severe than the delta variant, Fed hawkishness, Friday’s dip to risk may be an overreaction
• ECB’s Lagarde- It’s very unlikely to see rate hikes in 2022
• The CAD is the strongest currency this week with the Japanese Yen the weakest on the main board

Major Announcements last week:

  • Canadian GDP comes in at 0.1% for the month of October
  • Aussie GDP third quarter releases at -1.9% a full reflection of recent lockdowns
  • Canadian Unemployment Rate comes in at 6.0% in Nov down from September’s 6.7%
  • US Non-Farm Payroll prints at 210k dwon from expectations of 553k
  • US Unemployment Rate for November is 4.2% down from 4.6% in October
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