FXStreet (Bali) – According to Philip Borkin, Senior Economist at ANZ, the NZ employment report, while looking exaggeratedly good, should reduce the odds of an OCR cut by the RBNZ in the near-term.

Key Quotes

“In what is a huge surprise, today’s labour market figures showed the unemployment rate falling a massive 0.7ppts in Q4 to 5.3%, the lowest rate since March 2009.”

“That looks exaggerated, but details in the survey were generally good so we’ll run with the spirit; the labour market is improving, and amidst a strong labour supply backdrop.”

“Employment increased 0.9% q/q (after a surprise contraction in Q3). The composition of employment was solid, with both full and part-time employment rising. The alternative QES measure of filled jobs rose 1.0% q/q. Hours worked and QES paid hours rose 1.0% q/q and 1.4% q/q respectively. And total gross earnings were strong, lifting 2.1% q/q (6.0% y/y). This is all consistent with a reasonable economic backdrop.”

“The lift in employment is also consistent with timelier measures of labour demand such as firms’ hiring intentions and job ads.”

“The Household Labour Force Survey has long had questions over its accuracy given that there have often been cases where large “surprises” such as today’s outcome are thrown up. Those questions will linger today.”

“But stepping back, and discounting the move in the unemployment rate somewhat, there was still a positive hue to the figures.”

“That said, it was not one-way traffic. Measures of wage inflation were again soft (and below expectations).”

“Net on net, we feel the data reduces the odds of an OCR cut in the near-term (we’d go as far to say as it rules out March completely) and favour an ongoing watchful stance from the RBNZ.”

According to Philip Borkin, Senior Economist at ANZ, the NZ employment report, while looking exaggeratedly good, should reduce the odds of an OCR cut by the RBNZ in the near-term.

(Market News Provided by FXstreet)

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FXStreet (Guatemala) – We are now entering busy calendar territory for the US shifts as we approach the last remaining session for the week. Analysts at Nomura offered a preview for the key data releases in tonight’s US shift.

Key Quotes:

“ADP employment: In line with our forecast for BLS private nonfarm payrolls, we forecast that ADP private employment gained an additional 180k jobs in January (Consensus: 193k). ISM non-manufacturing: Although the ISM non-manufacturing index declined in December, the details of the report still pointed to steady activity in the non-manufacturing sector that month.

It continued to tell a story of a two-tier economy—one in which the manufacturing sector continues to struggle, and the service sector and labor markets remain more resilient. We expect the headline index to remain firmly in expansion territory at 56.0 in January (Consensus: 55.1).”

We are now entering busy calendar territory for the US shifts as we approach the last remaining session for the week. Analysts at Nomura offered a preview for the key data releases in tonight’s US shift.

(Market News Provided by FXstreet)

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