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Mining continues to drive Australian Private CAPEX higher.

Written by Sam Coxhead on May 31st, 2012.      0 comments

2:06 PM (NZT) A fresh wave of fear hit markets overnight as the ECB turned down a Spanish Government solution to recapitalize its struggling banks. Without a firm European wide solution the debit markets went into aggressive risk aversion. Non-core member European debt was trashed and German two year debt yield was again aggressively bought and yield hit 0.00, that’s right, just the simple return of your money. Weaker housing data in the US added to the negative sentiment, after what has been a stable run of housing numbers from the US market.
US and UK yields also hit record lows and the US dollar was stronger across the board, along with the Japanese YEN.
Closer to home the AUD and NZD have been under renewed pressure following yesterdays lower than expected Australian retail sales number and the wider market risk aversion. But today’s data was more positive. Discounting the notoriously volatile building approvals number, the Private Capital Expenditure numbers were well above expectations. Unsurprisingly the mining sector is driving the capital expenditure, in further evidence of the two tier economy.
Earlier the NBNZ Business Confidence Survey was released in NZ. Unsurprisingly the business sentiment was lower than the previous 36 level , coming in at 27. The market was unmoved by this data.
Since the Australian numbers we have seen a mild bounce in both NZD and AUD which can be seen on the table below.
          Past 24 hours
  Current level Pre-AU data  % Chge since AU data   Low High
NZD/USD 0.7526 0.7517 0.12%   0.7498 0.7616
AUD/USD 0.9705 0.9692 0.13%   0.9670 0.9805
NZD/AUD 0.7756 0.7757 -0.01%   0.7736 0.7771
AUD/NZD 1.2893 1.2892 0.01%   1.2868 1.2927
NZD/GBP 0.4862 0.4856 0.12%   0.4846 0.4878
NZD/EUR 0.6082 0.6075 0.12%   0.6064 0.6103
NZD/YEN 59.32 59.24 0.13%   59.11 60.79
NZD/CAD 0.7753 0.7745 0.10%   0.7727 0.7812