Morning View:
Media whispering is what I saw the RBA’s ‘tactic’ described as today, so lets go with that.
Peter Martin, the Economics Editor at the Age/Sydney Morning Herald published an article last night titled “Reserve Bank to cut interest rates in May in face of weak economy”. Now I don’t have a problem with opinion pieces. Everyone online has an opinion on absolutely everything, and monetary policy is no different.
What I do have a problem with, is major newspapers publishing opinions as if they are fact to a mainstream audience.
Well, is it just an opinion?
It doesn’t even matter if it is or it isn’t. It’s done the job that Stevens wanted and dumped the Aussie over 100 pips from the time the article was released (while the USDX was dumped alongside it mind you, showing the merit the Aussie move had).
If Stevens actually is giving under the table ‘whispers’ on monetary policy to the odd journalist who asks nicely, it’s not right. Trust is already completely gone from the RBA after multiple obvious leaks before the official release.
This is just the Terry McCrann circus re-branded and not the right way to conduct monetary policy decisions.
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On the Calendar Today:
A whole raft of bank holidays across Asia and Europe today in observance of Labor Day. There is still tier 1 Manufacturing PMI data out of China and of course the Greek headlines wont stop once the European session rolls around.
We end the week with ISM Manufacturing PMI out of the US and of course as always, watch out for any end of week/month flows.
Friday:
CNY Bank Holiday
CNY Manufacturing PMI
AUD PPI
EUR Bank Holidays
GBP Manufacturing PMI
USD ISM Manufacturing PMI
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Chart of the Day:
I spoke yesterday on Twitter about NZD/USD being in play following dovish comments out of the RBNZ. I never got a chance to post any charts to Twitter so I explain what I’m looking at below.
NZD/USD Daily:
Click on chart to see a larger view.
Price is trapped in a triangle pattern while consolidating around the key 0.7608 weekly level. I really like how price re-tested the highs, taking some stops above them while still trapped inside the triangle, before getting smashed down on the RBNZ comments.
NZD/USD 4 Hourly:
Click on chart to see a larger view.
Price has now come to short term trend line support, pushing through it yesterday before retesting the previous days but again being sold off them.
This is a good place to look to get short as the demand is absorbed, playing for a proper break down through the bottom of the triangle either tonight or next week.
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