Kiwi Soars on Appointment of New RBNZ Chief
| Market Drivers December 11, 2017
Kiwi soars on new RBNZ lead
Dollar fades post NFP
Nikkei 0.56% Dax 0.09%
Oil $57/bbl
Gold $1250/oz.
Bitcoin $16800
Europe and Asia:
No Data
North America:
No Data
It's been a relatively quiet open to the week of trade in FX with no economic data or newsflow to kick off trade for the majors and most pairs remained in tight ranges with the dollar giving back some of the gains earned in post NFP trade last Friday.
This week is known as central bank week with Fed, ECB, BoE, and SNB all scheduled to meet for policy announcements as the week progresses. The markets do not anticipate any major surprises in rate decisions but will be watching carefully for any upgrades in economic assessment for 2018 which would be the first step for tighter monetary conditions in G-7 universe.
In the meantime, while the majors lay flat, the kiwi was the star of the show rising more than 1% in Asian and early European trade on the announcement that Adrian Orr, 54, will begin a five-year term as governor of the Reserve Bank on March 27. A former deputy governor and chief economist at the RBNZ, Orr currently runs the New Zealand government's sovereign wealth fund which has returned 16.2 percent per annum over the last five years.
Mr, Ott is considered to be an old pro and investors were heartened to see that he will be taking the helm at a time when RBNZ faces its biggest transition in decades as it moves to a Fed-like dual mandate that will focus on both job creation and inflation. While Mr. Ott is neither a dove or a hawk, investors were reassured that he will keep the monetary policy on an even path restraining the worst impulses of a stimulatory monetary policy. The pair popped through the .6900 figure on the news today and could trade all the way towards key resistance at .7000 as the week progresses and more investors become reassured on New Zealand's monetary policy.
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