EU Open Report - 11.6.2015

RBNZ Surprize! US retail sales in the pipeline

- Record CNY strength hurts China exports, immediate let-up unlikely – Reuters.

- Australia May employment +41k, unemployment 6.0%, participation 64.7%, +11k,  6.2% and 64.8% eyed, full-time employment +14.7k.

- Australia June MI inflation expectations index off, weighted mean +2.3%,   trimmed mean +3.0%, May +2.4%, +3.6%.

- RBNZ cuts OCR 25 bps to 3.25%, further ease may be appropriate, another OCR   cut priced in, inflation low, CPI +0.7% end-’15, +2.1% end-’16, GDP +3.2% as  of March ’16, +3.1% March ’17, NZD weakness good, significant way to go.

Calendar for Today (from Investing.com)

Watchlist:

Best looking FX pairs for today are

GbpUsd Longs

UsdJpy Shorts

Failure to retrace the Kuroda drop means that action was expected

and the market is disappointed.

Kiwi will be on the watchlist for tomorrow

Already covered too much space today

 The RBNZ cut rates and offered downbeat guidance.

Themes for today:

a)  Greece. The meeting last night between Greek PM Tsipras, German Chancellor Merkel and French President Hollande ended with a Mexican Standoff. But the euro doesn't seem to care. More of the same can-kicking.

b)  the big event is US retail sales for May. Expectations are on the high side, but auto sales have been strong, wages increased and job growth accelerated.  A strong report would aid Yellen's rate hike plans and revive the rally in the dollar ahead of next week's FOMC meeting. It would take a very bad miss to change the market's bullish view.

c) The weekly initial jobless claims are also due for release in the US today.