GDT not a cause for upward expectations – BNZ

FXStreet (Guatemala) – Analysts at BNZ noted the GDT auction results overnight, They did not disappoint positive expectations, with prices up 14.9%. It was underpinned by a 19.1% jump in whole-milk powder prices.

Key Quotes:

“Even with its sizable jump overnight, the GDT price index is down 39% from March.”

“The GDT auction result overnight is not any cause for us to start thinking about revising up our milk price expectation for 2015/16.”

“It was encouraging to see the number of unsatisfied bidders continue to rebound, to a more normal looking number overnight, from an extreme low point at the 19 July auction. It was also encouraging that NZD, while trying to bounce on the auction result, didn’t get much traction.”

“Mostly, it allays risk that we might have had to revise it down further. Our current payout forecast, of $3.80, is predicated on a solid rebound in auction prices over the rest of the season. Of course, if dairy prices achieve this with force, and soon – conceivable on the basis of the recent supply glut working its way out – then there might be scope to revise up. But there’s an awful long way to go to conclude that.”

Analysts at BNZ noted the GDT auction results overnight, They did not disappoint positive expectations, with prices up 14.9%. It was underpinned by a 19.1% jump in whole-milk powder prices.

(Market News Provided by FXstreet)