Tuesday, 28 Jul 2009

AUD and NZD Shock with Volatility; CBI had Muted Impact

The opening of today's market experienced a great opportunity for traders involved with the Pacific currencies. The release of data from New Zealand showed its trade balance experiencing a sharp deficit, leading to, against all odds, a strong climb in the value of the NZD. Coupled with the various reports from Australia in the early morning hours, these Pacific currencies have helped to massively increase trading volume throughout the trading day.

Traders also got a glimpse into wholesale and retail sales levels in Britain with the release of the CBI Realized Sales report at 10:00 GMT this morning. With a figure slightly worse than predicted, the GBP has already priced in the negative movement, but remained within its current trends.

The likelihood that the previous news events from Britain, New Zealand, and Australia would lead the market today was slim. Most traders who were anticipating volatility in the GBP following the release of the CBI figures were no doubt disappointed by the non-event. This is likely due to the fact that most market participants were awaiting the opening of the US market at 13:00 GMT and the multiple economic reports that will be released shortly thereafter. If you're not watching your calendar between 13:00 and 15:00 GMT, you should be; volatility's on the way!