Rise In Dairy Prices Continues With This Morning’s Global Dairy Trade Auction - APAC Update

Xe Corporate APAC

March 19, 2019 3 min read

The AUDUSD opened at 0.7092 (mid-rate), and the NZDUSD opened at 0.6857 (mid-rate) this morning.

APAC Update

There was little reaction to yesterday’s RBA minutes in which policymakers reiterated that there wasn't a strong case for a move in the policy rate in the near term. There remains significant uncertainty on the economic outlook. The RBA expressed concern over the health of the domestic housing sector along with underwhelming economic growth.

The recent rise in dairy prices continues with this morning’s Global Dairy Trade (GDT) auction resulting in an eighth consecutive increase in prices.

This morning’s event concluded with the overall index up 1.9% with a total of 21,713MT of product selling under the hammer. Whole milk powder (WMP) prices were up 4% selling for an average price of US$3,317/MT. Rennet Casein (RenCas) and butter prices produced the largest gains up 9.7% and 9.3% respectively while skimmed milk powder (SMP) was one of the few products on offer to decrease in value, down 2.4% to US$2,405/MT.

UK Update

The British pound has benefited from a better-than-expected labour report with the Office for National Statistics reporting employment increased by 220,000 in Q4 2018. Employment had been forecast to increase by 120,000 jobs. The UK now has an employment rate of 76.1%, its highest recorded level.

Unemployment in the UK now sits at 3.9% - its lowest level since 1975 and marginally below the 4.0% forecast.

US Update

The US Commerce Department reported factory orders during the month of January edged up 0.1% equalling the increase seen in December and below the forecast 0.3% rise. The report showed orders for transportation equipment along with durable goods orders increased by 1.2% and 0.3% respectively while orders for non-durable goods dipped by 0.2%.

Europe Update

Germany's investor confidence showed a strong increase of 9.8 points in March, with the ZEW report showing the index rose to -3.6 up from -13.4 in February and well ahead of the expected -11 result. This morning’s Current Account report is expected to have little effect as investors look to tomorrow morning’s FOMC statement and New Zealand's Q4 GDP data release for direction.

Global equity markets remain mixed, - Dow +0.35, S&P 500 +0.37, FTSE +0.34%, DAX +1.135%, CAC +0.24%, Nikkei -0.08%, Shanghai -0.18%.

Gold prices are little changed, trading at $1,306 an ounce. WTI Crude Oil prices have inched higher overnight, up 0.3% trading at $59.19 a barrel.

Mid-market Update

AUDUSD0.70920.0%NZDUSD0.68570.1%AUDEUR0.6247-0.2%NZDEUR0.60410.0%AUDGBP0.5343-0.3%NZDGBP0.5167-0.2%AUDJPY78.990.0%NZDJPY76.380.1%AUDNZD1.0341-0.2%NZDAUD0.96680.1%GBPAUD1.87160.3%NZDCAD0.9131-0.2% GBPNZD1.93540.2%
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