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NZ retail sales disappoint.

Written by Sam Coxhead on November 14th, 2012.      0 comments

12:00 PM (NZT) This morning’s 3rd quarter Retail Sales was demonstrably weaker than expected. Core retail sales fell .3% over the quarter and this was against a market expectation of a .6% rise in activity. The fall came with contraction in 9 of 15 sectors, including the three largest of grocery, motor vehicle and fuel retailing (all down between 1.5-2%).
The NZD has seen pressure following the number. And this pressure was added to by well times verbal intervention from an increasingly market savvy NZ Minister of Finance Bill English. English said the NZD was ‘higher than we are comfortable with’, it was a well timed quip.
This number, coupled with last week’s increased unemployment rate does start to raise the question of the RBNZ coming back into play. It will be interesting to see how the interest rate markets react in the coming days. Current pricing has seen the chances of a 25point cut to the current 2.50% cash rate of around 82% by March , vastly increased since early last week. Anecdotal evidence points to a pickup in sentiment and activity since the 3rd quarter, so the come months, and indeed the 4th quarter data will be central to direction in early 2014.
Overnight markets saw increased risk appetite following suggestions on Reuters that Germany wanted to bundle three aid tranches to Greece into one. The story was subsequently denied and the market tempered its enthusiasm. UK inflation pressure again out stripped expectations at 2.7% and lowers the chances of further stimulation from the BOE in the near term.
Currency pair Current level Pre-NZ RS Percentage change 24 hour range
NZDUSD 0.8164 0.8195 -0.38% 0.8149 0.8207
AUDUSD 1.0432 1.0439 -0.07% 1.0392 1.0449
NZDAUD 0.7825 0.785 -0.32% 0.7808 0.7860
AUDNZD 1.2780 1.2739 0.32% 1.2723 1.2807
NZDGBP 0.5145 0.5163 -0.35% 0.5128 0.5165
NZDEUR 0.6427 0.6450 -0.36% 0.6417 0.6460
NZDJPY 64.84 65.06 -0.34% 64.72 65.22
NZDCAD 0.8182 0.8212 -0.37% 0.8155 0.8214
Topics: NZD