28 Sept: US$ firm after solid D/G data, tax reform proposals. RBNZ on hold. US Q2 GDP, central bankers in focus today.

By | September 28, 2017

 

The US$ remains firm on Wednesday following the release of the Durable Goods orders, which rose by 1.7% in August, versus consensus of 1.0%. The good figures were then backed up by Donald Trump’s tax proposal,  to cut corporate income tax rates, cut taxes for small businesses, reduce the top income tax rate for individuals and scrap some widely used tax breaks. In the bigger picture though, markets remain skeptical that the reform will pass through Congress and the dollar failed to make much new headway. The S+P liked what it heard and made a new all-time high although the DJI failed to do so and remained rangebound. Gold and Silver are under pressure from the firm dollar, while WTI had a tight range and remains unchanged from yesterday.

Thursday will commence with the NZ Interest Rate Decision although no change is expected from the RBNZ with rates to remain on hold at 1.75%, while the main focus is likely to be on the accompanying statement with the chance of a hawkish lean, which could see a rally in the Kiwi. Most analysts expect little change in tone from the previous meeting.  – NB> The RBNZ just left rates on hold and the Kiwi is off its highs but remains within the day’s range.

The Fed’s Rosengren will be speaking at the same time, so traders will be looking for any dovish/hawkish lean in either direction, while later in the Asian session, the BOJ’s Kuroda will be speaking. It will be a big day for central bankers as the ECB’s Praet, the BOE’s Carney and the RBA’s Debelle will be the next cabs off the rank during European hours. In terms of data, the German provisional CPI for September will take top billing in Europe (exp 0.1%mm, 1.8%yy), while the US has the Q2 GDP (exp 3% annualised),  the Core Personal Consumption/Expenditure for Q2 (exp 0.9%), the Wholesale Inventories, weekly Jobless Claims, Kansas Fed Mfg Activity  and the Goods Trade Balance. Also coming up will be speeches from the Fed’s George and Fischer.

CURRENCIES
EURUSD: 1.1744
Res  1.1775  1.1795  1.1820
Sup  1.1720  1.1700  1.1680
USDJPY: 112.80
Res  113.00  113.25  113.55
Sup  112.50  112.20  112.00
GBPUSD: 1.3392
Res  1.3400  1.3430  1.3460
Sup  1.3365  1.3300  1.3320
USDCHF: 0.9716
Res  0.9745  0.9770  0.9810
Sup  0.9700  0.9685  0.9660
AUDUSD: 0.7851
Res  0.7870  0.7885  0.7910
Sup  0.7835  0.7810  0.7785
NZDUSD: 0.7202
Res  0.7220  0.7235  0.7250
Sup  0.7180  0.7165  0.7140
INDICES / COMMODITIES
S&P: 2503
Res  2510  2515  2520
Sup  2495  2490  2485
DJI: 22291
Res  22320  22355  22385
Sup  22230  22200  22170
ASX SPI: 5662
Res  5690  5710  5730
Sup  5630  5605  5590
XAUUSD: 1283
Res  1290  1295  1300
Sup  1280  1275  1270
XAGUSD: 16.76
Res  16.90  17.10  17.25
Sup  16.70  16.55  16.45
WTI: 52.00
Res  52.45  53.10  53.80
Sup  51.10  50.40  49.50