PERU: President Castillo Resigns From Peru Libre Party Membership
Peruvian President Pedro Castillo has tweeted the following: "Today I presented to @JNE_Peru my irrevocable resignation from the Peru Libre political party. Such a decision is due to my responsibility as president of 33 million Peruvians. I am respectful of the party."
- Peru Libre leader Vladimir Cerron had asked Castillo to give up his membership in the party because of breaking its unity and failing to follow through on his electoral promises.
- “It is necessary to emphasize that the policies undertaken by his government are not consistent with what was promised in the electoral campaign and even less so with the party's program and ideology, implementing the losing neoliberal program”, Peru Libre said in a statement.
- Tensions between the President and Peru Libre contibuted to the breakdown of the party's parliamentary representation. The party started the term with 37 lawmakers, but 21 of them have quit and some formed new groups in parliament.
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JGB TECHS: (M2) Fades Off Key Resistance
- RES 3: 151.13 - High Mar 3
- RES 2: 150.44 - High Mar 14
- RES 1: 150.14/17 - High Apr 1 and key resistance / Intraday high
- PRICE: 149.59 @ 15:53 BST May 31
- SUP 1: 148.96/72 - Low May 10 / Low Mar 29 and the bear trigger
- SUP 2: 148.69 - 3.0% Lower Bollinger Band
- SUP 3: 148.16 - 1.0% 10-dma envelope
The primary downtrend in JGBs remains intact, with prices resuming their drift this week. Price is returning lower after rejecting a challenge of key resistance at 150.14, Apr 1 high. A clear break of this level would signal scope for a stronger corrective cycle and open 150.44, the Mar 14 high. Further downside would signal a resumption of bearish activity and open 148.96 and major support at 148.72.
AUSSIE BONDS: Futures Marginally Softer Vs. Settlement, GDP Eyed
Aussie bond futures generally tracked the gyrations observed in U.S. Tsys during post-Sydney dealing, failing to make much headway below their respective Sydney session troughs despite a couple of attempts to break lower. That leaves YM and XM just below their Tuesday settlement levels shortly after Wednesday’s open, -1.5 & -2.0, respectively, marginally below late overnight session levels. Bills are flat to -3 through the reds.
- Q1 GDP data, the final manufacturing PMI print from S&P Global, the latest CoreLogic house price reading and A$1.0bn of ACGB Apr-25 supply headline domestic matters on Wednesday. Re: GDP, the BBG consensus looks for +0.7% Q/Q after yesterday’s inventories and public spending data buoyed sell-side estimates.
NZD: Bearish Outside Day
NZD/USD went offered Tuesday, as U.S. Tsys retreated when cash trading re-opened in Tokyo after a long weekend in the U.S. Struggling equity markets in Europe and the U.S. applied further pressure to the pair. NZD/USD snapped a four-day winning streak as a result, charting a bearish outside candlestick.
- The rate last deals at $0.6518, barely changed on the day. A slide through May 24 & 25 lows of $0.6423 would encourage bears to take aim at May 18 low of $0.6291. Conversely, should the rate manage to break above May 5 high of $0.6568, bulls could target the $0.6600 mark.
- NZ housing market continues to cool, CoreLogic House Price Index showed. CoreLogic noted that "with housing credit tight and getting more expensive by the week, this trend towards weaker housing market conditions is likely to continue."
- The RBNZ has launched consultations on the five-yearly review of its monetary policy remit, noting that it seeks feedback on the appropriateness of the 1-3% inflation target and using the CPI as the main indicator of inflation.
- NZ PM Ardern met U.S. Pres Biden in the White House to discuss the Ukraine situation, the Pacific region, the Indo-Pacific Economic Framework (IPEF) and climate change.
- RBNZ Asst Gov Hawkesby will make another presentation on the MPS today. China's Caixin M'fing PMI & Australian GDP will be eyed for any spillover into NZ markets.
- Looking further afield, New Zealand's terms of trade will hit the wires on Thursday, with completed construction work coming up Friday.
