RBA Assistant Governor Kent Speaking at an XE Hosted Breakfast - APAC Update

The AUD opens at 0.7102 and the Kiwi opens at 0.6836.

In Australia, all eyes turn to RBA Assistant Governor Kent speaking at an XE hosted breakfast at 7:30 AEDT/9:30 NZT. Special focus will be on the questions after his speech. Please contact us for more details about Kent's speech.

The Kiwi managed to hold onto its gains after the RBNZ announcement on Wednesday. The market had priced near a 95% chance of a cut during 2019, so was caught very offside by the less than dovish comments. Market is now pricing in roughly a 50% chance of a cut, which still seems high, given how neutral and on hold the RBNZ is.

US update

US Retail sales fell by the most since 2009, but the market is more focused on trade talks, which have officially started between the US and China. The rumour yesterday afternoon was the 1st March deadline of tariff increases could be extended another 60 days.  You can expect many headlines like this over the coming weeks. It will truly be the trend in positive/ negative headlines that will be worth watching out for.

UK update

Out of the UK, Parliament defeated a vote reaffirming support for May's plan to seek changes to her Brexit deal. Three weeks ago, parliament had voted in favour of her trying to get changes out of the EU, but not anymore. British seem very happy to say what they don’t want, yet a little less inclined to say what they would do. The EU’s patience must be running pretty thin, and a rejection of any potential Article 50 extension would be a good way to force a resolution - one way or the other.

Upcoming data

Chinese CPI data will be released today at 2:30 Auckland time, which can be a big driver of the AUD.

Global equity markets are flat, Dow -0.06%, S&P 500 +0.03%, FTSE +0.09%, DAX -0.69%, CAC -0.23%, Nikkei -0.02%, Shanghai -0.05%.

Gold prices are flat at 1,314 an ounce.

WTI Crude Oil prices are up slightly, trading at $54.45 a barrel.

Mid-market rates

AUDUSD0.71020.0%NZDUSD0.68360.4%AUDEUR0.6288-0.2%NZDEUR0.60530.3%AUDGBP0.55520.5%NZDGBP0.53440.9%AUDJPY78.57-0.2%NZDJPY75.650.2%AUDNZD1.0388-0.4%NZDAUD0.96270.4%GBPAUD1.8016-0.5%NZDCAD0.90820.8% GBPNZD1.8711-0.9%
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