Sharechat Logo

NZ dollar falls as fears about slowing Chinese growth weigh on commodity prices

Friday 20th July 2018

Text too small?

The New Zealand dollar fell as growing fears of a slowing Chinese economy pushed down metal prices and weighed on currencies of nations producing raw materials. 

The kiwi declined to 67.45 US cents as at 830am in Wellington from 67.82 cents yesterday. The trade-weighted index decreased to 72.74 from 72.89. 

The Thomson Reuters CRB commodity price index of 19 commonly traded raw materials fell 0.1 percent after reports that the People's Bank of China will use a medium-term lending facility to encourage banks to increase lending and buy corporate bonds, and take steps to cut borrowing costs for small businesses. Chinese authorities have been increasing interventions as the world's second-biggest economy deals with slower lending in its shadow banking sector and prepares for the fall-out from its trade war with the US. 

"Commodity currencies are the worst performers on the day in FX, reflecting further falls in industrial metals prices and some concerns about slowing growth in China," Bank of New Zealand interest rate strategist Nick Smyth said in a note. "The NZD moved lower overnight, in sympathy with the moves in the CNY."

The kiwi traded at 4.5664 Chinese yuan from 4.5693 yuan yesterday. 

Local data today include June migration and visitor arrival numbers, which are expected to show a slowing pace of net inbound migration. 

Meantime, the greenback's gains were halted after US President Donald Trump told CNBC he wasn't happy with interest rate rises, which he said put the world's biggest economy at a disadvantage to nations with lower rates. 

The kiwi rose to 91.66 Australian from 91.41 cents yesterday. Bureau of Statistics figures yesterday showed Australia added 50,900 jobs last month, more than the 17,000 forecast. 

The local currency fell to 57.90 euro cents from 58.22 cents yesterday and traded at 51.80 British pence from 51.86 pence. It fell to 75.81 yen from 76.45 yen. 

(BusinessDesk)

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Gold Report 21st May 2019
NZ dollar falls after RBA governor flags potential rate cut
ASB reviews ownership of Aegis
Auckland Airport kicks off next phase of expansion
Cashed-up Plexure eyes acquisitions to accelerate growth as loss shrinks
Tower turns to 1H profit, lifts FY guidance
IRD should have doubled claim against Watson's Cullen Group - Professor
Investore FY profit falls 16% on smaller valuation gain, signals flat dividend for 2020
Synlait receives cease and desist letter regarding Pokeno plant
21st May 2019 Morning Report

IRG See IRG research reports