NZD Up on BetterthanExpected Employment Data; BoE

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Rates as of 0500 GMT

Market Recap

Yesterday morning I suggested that after its big fall Tuesday, NZDJPY might rebound on Wednesday. Boy did it ever! New Zealand 1Q unemployment beat estimates, with the number of jobs rising twice as fast as expected 0.6 qoq vs 0.3 expected and the unemployment rate falling to 4.7 from 4.9, vs expected unchanged figure.

This with the participation rate rising to 70.4 from 70.2 vs 70.3 expected.Total employment is now higher than it was before the pandemic.

New Zealand has done the best among the G10 countries in terms of employment recovery.

Other currency movements arent really worth talking about just the financial equivalent of Brownian motion. EURUSD fell through 1.20, staged a recovery, but couldnt sustain the gains and is still below that level.

There seem to be some questions over the outlook for Europe despite the EUs vaccination rate catching up with the US. For example, concerns are mounting about EUChina relations. The European Commission proposed new rules that would allow it to take action against foreign companies that benefit from distortive subsidies granted by nonEU countries, to bring foreign trade in line with the rules regarding EU governments subsidizing their companies. The proposed legislation, clearly aimed at China, comes after the European Commission Tuesday suspended efforts to ratify the EUChina investment agreement, due to EU sanctions against China and the Chinese countersanctions.

The…

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