HALISTER1: INSIDE G-10: AUD Holds Post FOMC Gain; Kiwi Slips After RBNZ

INSIDE G-10: AUD Holds Post FOMC Gain; Kiwi Slips After RBNZ

(Bloomberg) -- AUD retained overnight FOMC inspired gains throughout a neutral first appearance as RBA governor by Philip Lowe before parliament. NZD facing downward pressure after a dovish RBNZ.
  • USD/JPY failed to hold on to early rise toward 100.47 as meeting today between BOJ, FSA and MOF officials isn’t seen as market moving; pair down 0.1% to 100.23
  • NZD/USD drops 0.2% to 0.7335 vs 0.7325-0.7369 range
    • Fonterra expects only gradual increase in dairy prices
    • RBNZ leaves rates unchanged at 2%, signals further easing
  • AUD/USD up 0.3% to 0.7645 vs 0.7535-0.7550 range
    • Key takeaways from Lowe’s speech to parliament;
      • Unlikely RBA would resort to unconventional monetary policy measures. A flexible inflation- targeting policy which takes account of financial risks is most appropriate
      • It would be a “surprise” if Donald Trump were elected U.S. president; RBA doesn’t have a specific “contingency plan” in place should the Republican nominee win
      • Governor is “somewhat more comfortable” with the situation on housing following signs that it has slowed
  • EUR/USD sidelined at 1.1196 ahead of Draghi speech
    • Greek Prime Minister Alexis Tsipras says in interview with Reuters, hopes Greece could within next 6 months be included in ECB’s quantitative easing program
    • German GDP growth is likely to slow in the second half, though consumer confidence is “robust,” the Finance Ministry says in its monthly report
  • BBDXY slips 0.2% to 1182.10
  • WTI crude oil and copper gain; gold falls
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
40005Z AU (Reserve Bank of Australia)

People
Philip Lowe (Reserve Bank of Australia)
Alexis Tsipras (Hellenic Republic)
Donald Trump (Trump Hotels & Casino Resorts Inc)

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