Thursday 10th October 2019 |
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The New Zealand dollar was slightly weaker as the greenback benefited from reduced tensions between the US and China ahead of tomorrow’s trade talks.
The kiwi was trading at 62.94 US cents at 8am in Wellington versus at 63.12 cents at 5pm in Wellington. The trade-weighted index was at 70.30 points from 70.52.
“Tensions between US and China appear to have eased a tad ahead of the trade talks set to resume tomorrow. China is reported to be willing to buy more agriculture goods in exchange for reduced tariffs,” said ANZ Bank agriculture economist Susan Kilsby and FX/rates strategist Sandeep Parekh.
China remains open to agreeing to a partial trade deal with the United States, despite the inclusion of top Chinese artificial intelligence startups in a trade blacklist, Bloomberg reported
Markets will remain closely focused on any headlines out of the talks.
The kiwi, meanwhile, was largely unmoved by minutes from the US Federal Reserve that showed most committee members supported the September rate cut but they remain divided on the way forward.
“Most participants believed that a reduction of 25 basis points in the target range for the federal funds rate would be appropriate,” the Fed said in the minutes.
According to Reuters, however, while participants were concerned about the trade wars, slowing global growth and Brexit “they differed on what that meant for the US economy.”
Seven of the Fed’s 17 policymakers last month indicated they forecast one more rate cut this year. Five policymakers did not consider any more cuts were needed and the other five projected a rate rise by the end of 2019. Investors expect another rate cut at the next meeting on Oct. 29-30.
The New Zealand dollar was trading at 93.50 Australian cents from 93.62. It was unchanged at 67.64 yen, at 4.5865 Chinese yuan from 4.5089, at 51.51 British pence from 51.67 and at 57.32 euro cents from 57.56.
(BusinessDesk)
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