The New Zealand dollar took hits from Chinese and Australian catalysts last week. Can this week’s releases push the comdoll back up?
Here’s a short list of this week’s potential catalysts:
Quarterly employment data (Apr 30, 11:45 pm GMT)
The last labor market data showed the unemployment rate climbing from a downwardly revised 4.0% (from 3.9%) to 4.3% in Q4 2018. That’s a couple of points higher than the estimated 4.1%!
The details didn’t look much better. The numbers of unemployed increased by 8K; labour force participation rate slipped from 71% to 70.9%, and underutilization inched higher from 11.4% to 12.1%.
Wages was a bright spot, though, with the quarterly labor cost index rising by the same pace as the previous two quarters while the annual reading edged up from 1.8% to 1.9%.
Analysts have mixed expectations for this week’s release. While they expect the unemployment (4.3%) and labour force participation (70.9%) rates to maintain their previous readings, they also see quarterly employment speed up from 0.1% to 0.5%.
Meanwhile, the quarterly labor cost index could remain at 0.5% even as the annualized reading improves from 2.0% to 2.1%.
It’s been a couple of years since the Reserve Bank of New Zealand (RBNZ) has made changes to its interest rates.
But given how the Kiwi reacted to the previous labor market data and last week’s poor Australian CPI release, it’s possible that upside or downside surprises to this week’s numbers could influence intraweek trends, if not sharp spikes, for the comdoll.
Other top-tier releases
A busy week means plenty of chances for traders to trade the Kiwi as a high-yielding bet!
The party is kept alive by a slew of PMI reports coming our way. That’s right, China, the U.K., the euro zone, and the U.S. are all scheduled to print manufacturing and services PMIs over the next couple of days!
Remember that investors are worried over slowdown in global demand, so traders pay close attention to PMIs for confirmation of potential production and services trends.
And then there are this week’s central bank events. The Fed will start the party on Wednesday with the Bank of England (BOE) on its heels the next day.
Market geeks aren’t expecting any changes, but you can bet that traders will pore over their statements for any tidbits that might cause volatility!
Last but not the least are the NFP-related shenanigans, which starts with the ADP report and the labor part of ISM’s manufacturing PMI scheduled just before the Fed’s event. Then, Challenger’s job cuts, quarterly labor costs, and weekly unemployment claims are scheduled on the next day.
The NFP week concludes with the NFP report itself, which is expected to show slightly lower net payroll addition (188K vs. 196K previous) and a steady unemployment rate (3.8%) for April.
Missed last week’s price action? Read NZD’s price recap for April 22 – 26!