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A banquet of Central Banks - ANZ

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Nov 30, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Guatemala) - Analysts at ANZ explained that the next few weeks provides somewhat of a banquet of key central decisions that will certainly help shape markets well into 2016.

    Key Quotes:

    "And perhaps just like the Thanksgiving dinner tables of many Americans over the past few days, there should be plenty of variety on offer to keep markets satiated. At one end of the spectrum is the RBA today, which is priced to be an uneventful meeting – not “live” in the words of our Australian colleagues – which is unsurprising considering Governor Stevens told markets to “chill out” last week and wait to see how things unfold after Christmas."

    "Nevertheless, the accompanying statement will still be perused for any hints of the relative importance the Board is putting on recent data, which showed the dichotomy of strong employment, but weak capital expenditure. We will also be interested in any shifts in the RBA’s AUD language considering iron ore prices have fallen 20% since September but yet the AUD has remained broadly unchanged over that time."

    "At the other end of the ‘eventful’ scale are of course the decisions of the ECB and the Fed, although action from both (while clearly heading on divergent paths) has now become reasonably well priced. In fact, perhaps it is the RBNZ’s decision next week that is shaping as the most contentious, and market pricing has shifted back to around 50/50 following yesterday’s solid Business Outlook. As we wrote in yesterday’s Market Focus, a case for cutting the OCR next week certainly exists given low inflation, dairy pressures and global risks; it’s just that we don’t feel it is that clear cut – and market pricing agrees. When we consider the improving domestic growth backdrop, the less dire outlook for the terms of trade, housing market considerations, ongoing falls in fixed mortgage rates, and the need for more clarity on the global scene, we feel there is merit in watching and waiting a little longer."
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