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Currency Market Analysis

Jan 01, 0001 | Currency Market Analysis

Global Themes

USD higher on trade tensions, NZD falls after RBNZ cuts rates

The US dollar was higher overnight trade tensions pressured global markets.

The renewed tensions between the US and China has caused sharemarkets to weaken with the US’s Dow Jones index down 1.9% so far this week.

The trade tensions boosted the greenback and US dollar.

NZD hit

In other markets, the New Zealand dollar fell on news the Reserve Bank of New Zealand had cut interest rates.

The RBNZ cut official interest rates from 1.75% to 1.50% saying the NZ economy had slowed, trade worries could have a negative impact, and the jobs market is showing signs weakness.

However, the NZD’s losses were only short-lived, with the RBNZ unwilling to commit to a “easing” bias in the post-meeting press conference.

Inflation watch

With central banks around the world focused on inflation, today’s big events include consumer prices from China and producer prices from the US.

The Federal Reserve chair Jerome Powell also speaks tonight.

Tomorrow, the Reserve Bank of Australia’s detailed Statement of Monetary Policy is released and will be closely watched for its updated economic forecasts.

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