Kiwi unsteady as global trade tensions escalate
Monday 20 May, 2019
Daily Currency UpdateNZD - New Zealand DollarThe New Zealand dollar followed its antipodean counterpart lower on Friday compounding the weeks downtrend and touching 0.6515, its lowest level for the year to date. Growing concerns US-China trade war will continue to escalate have dampened demand for the Kiwi as investors appetite for risk is sapped, while USD indices drive broader USD strength. The NZD remains at risk to further downside as swaps move toward there lowest levels on record and global growth concerns weigh on commodity led and emerging market units. Attentions now turn to Wednesday’s retail sales print as a marker for direction through the week ahead.
Key MoversThe U.S. Dollar outperformed key rivals through trade on Friday advancing against both the Euro and Pound. Concerns over European Parliamentary elections and Britain’s exit from the European union weighed on both currencies as investors looked to haven assets. While the Euro found some support in a commitment from President Trump to waylay the imposition of auto tariffs on Germany and Japan the combined unit failed to make any significant headway and opens this morning only marginally above 1.1150, while the GBP lodged its worst week for 2019 as Brexit talks broke down.The GBP plunged to a four-month low as talks between Theresa May and Labour Leader Jeremy Corbyn broke down. May’s failure to advance a deal at home has dampened investors demand for the Pound and forced a move outside recently narrow ranges as markets begin to price in the likelihood of an exit without a deal. Sterling opens this morning only marginally above 1.27 having touched lows at 1.2701.
- NZD/USD: 0.6480 - 0.6580 ▼
- NZD/EUR: 0.5780 - 0.5880 ▼
- GBP/NZD: 1.9280 - 1.9580 ▼
- NZD/AUD: 0.9450 - 0.9540 ▲
- NZD/CAD: 0.8710 - 0.8860 ▼