New Zealand dollar extends recent down trend after RBNZ kept the OCR unchanged at 3.50% as widely expected. Governor Graeme Wheeler indicated that 'it is prudent to undertake a period of monitoring and assessment before considering further policy adjustment'. The RBNZ appeared deliberatively vague in communicate the timing of the next rate hike, noting that it expects 'some further policy tightening will be necessary to keep future average inflation near the 2% target mid-point and ensure that the economic expansion can be sustained'. Overall, the policy statement appears more dovish than expected on reduced inflationary pressure.
NZD/USD reaches as low as 0.8179 so far after the release. The fall from 0.8835 is still in progress and there is no clear sign of bottoming yet even though oversold position is seen in daily RSI. Near term outlook will stay bearish as long as 0.8269 resistance holds. Current fall would target 61.8% retracement of 0.76682 to 0.8835 at 0.8122 and below. We'll look for bottoming signal between 0.8051 support and 0.8122.
Australian dollar recovered stronger after data showed an unrealistic 121k growth in the job market in August. Economists noted that the unprecedented numbers were largely due to change in sampling and composition of the survey. The ABS started adjusting the definitions and changing samples in July 2014 and will continue through May 2015. Thus, there are possibilities of strange numbers in the upcoming releases. And looking through the noises, around 18.2k jobs were created only. Nonetheless, that's still better than expectation of 15k. Unemployment rate dropped back to 6.1%, down from July's 6.4% and same sa June's 6.1%.
EUR/CHF recovered strongly overnight on reports of comments from SNB officials. An alternate member of SNB governing board, Thomas Moser, said that negative interest rates is always a "possibility" for the central bank. And he noted that SNB would use it "if needed". There are speculations that, in response to ECB's recent announcement, SNB could start adopting negative rates in the upcoming meeting on September 18. Nonetheless, most analysts believe that SNB would stay with intervention for the moment to defend the EUR/CHF 1.2 floor.
Elsewhere, UK RICS house price balance dropped to 40 in August. Japan BSI large industry index rose to 12.7 Q/Q in Q3. China CPI slowed more than expected to 2.0% yoy in August while PPI dropped -1.2% yoy. German CPI and ECB monthly bulletin will be featured in European session. Canada new housing price index and US jobless claims will be release in US session.