NZD, AUD Up, CHF Down; US Retail Sales, Jobless Claims


Rates as of 0500 GMT

Market Recap

Well, as usual Im right but unfortunately the market doesnt agree. NZD continued to appreciate despite my coruscatingly brilliant argument that yesterdays Reserve Bank of New Zealand RBNZ statement didnt warrant it. To make matters worse, even though there was a blowout Australia employment report unemployment rate falls to 5.6 from 5.8 vs 5.7 forecast, employment rises 70.7k or double the 35.0k forecast, and a rise in the participation rate to 66.3 vs forecast of unch 66.1 the market latched onto the fact that fulltime jobs fell, and all the increase was in parttime jobs as an excuse to sell AUD after the report came out. So although AUD moved higher during yesterdays trading day, as I expected, its currently headed down.

As a result AUDNZD, which I thought was a buy at 1.0815 yesterday, is currently trading at 1.0794. Oops! Not the best call Ive ever made, although unfortunately not the worse either, Im embarrassed to admit.

The other big move was in CHF. I suspect the reason is technical EURCHF was trading below 1.10 on Monday, it recovered that level late in the day and was trading above it on Tuesday. Traders made some attempts to push EURCHF back below 1.10 and it didnt work, so if you dont make money selling, try making money buying.

I would just note that as of December last year, the OECD estimated that the purchasingpowerparity rate for USDCHF at 1.1438, vs the actual rate of 0.9233 today, so in my view the grossly…


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