Asian Session Forex Recap – Feb. 26, 2015

  • New Zealand trade balance up from -195 million NZD to 56 million NZD vs. -162 million NZD forecast
  • New Zealand visitor arrivals rebound by 0.8% from previous 1.3% decline
  • Australia’s private capital expenditure down by 2.2% in Q4 vs. estimated 1.7% drop
  • German GfK consumer climate index and unemployment change data due
  • U.K. preliminary GDP reading and business investment figures up for release

Not so fast, Aussie! The Australian dollar was forced to return some of its recent forex gains after the country printed a weaker than expected private capital expenditure reading for Q4 2014. The report indicated a 2.2% decline, worse than the projected 1.7% drop, indicating weaker business conditions.

Meanwhile, data from New Zealand was more upbeat, as the January trade balance showed a 56 million NZD surplus instead of the projected 162 million NZD shortfall. This was also a significant improvement from the December’s 195 million NZD trade deficit. However, a closer look at the components of the report reveals that dairy exports were still down for the period, mostly due to the fall in prices. Imports also chalked up a decline, reflecting a downturn in domestic demand.

AUD/USD is testing the .7850 minor psychological level (-0.38%) and AUD/JPY is hovering around the 93.50 mark (-0.3%) so far. Kiwi pairs are enjoying a few gains, with NZD/USD up 22 pips (+0.29%) and NZD/JPY higher by 31 pips (+0.35%), thanks to the 0.8% rebound in New Zealand visitor arrivals for January.

For the upcoming London trading session, forex traders might focus their attention on Germany’s economic data, with the GfK consumer climate index and unemployment change figures up for release. Consumer confidence might see a small improvement, as the index is slated to climb from 9.3 to 9.6 this month, while the labor report could show a 10K drop in joblessness.

As for the pound, it could also experience a bit of volatility during the release of the U.K. preliminary GDP reading for Q4 2014 and the business investment report for the same period. No revisions are expected for the GDP figure at 0.5% while business investment might post a 2.2% quarterly gain, probably enough for the British currency to extend its rallies.

U.S. Session Recap

Bonnie and Clyde, peanut butter and jelly, Justin Bieber and his hair. Some things just go well together.

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