Daily Market Commentary 20th October 2020

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Chinese GDP and Retail Sales both beat expectation and boosted the early Asian trading markets. Chinese 3rd Quarter GDP numbers rose 4.9%, less than the expected 5.2%, while Retail Sales jumped 3.3%. This was an early boost to Asian markets and allowed the AUD to rally above 0.7050, while the NZD consolidated above 0.6600. The return of the incumbent Labour Government in NZ, seemed to ensure some continuity and markets will keenly await their economic plan for the economic tsunami to come.

Markets turned sharply negative in European and US trade due to coronavirus concerns. There has been a massive resurgence across Europe and the US, although Governments’ are reluctant to go back to the economically catastrophic lock-downs, once again. Hopes of yet another US stimulus/bailout package are rising, as negotiations between the White House and Speaker Pelosi continue. The Dollar declined, with the EUR rebounding to 1.1770, while the GBP pushed back to 1.2970, despite defective trade negotiations.

Local markets will have a look at the rhetoric from the RBA minutes and NZ Business Confidence data.

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