Sharechat Logo

NZ dollar gains to 7-week high as Xi, Trump soothe trade dispute fears, risk appetite rises

Wednesday 11th April 2018

Text too small?

The New Zealand dollar rose to the highest level in seven weeks as US President Donald Trump tweeted his thanks to Chinese President Xi Jinping for saying he was committed to an open economy and lower tariffs.


The kiwi dollar rose to 73.68 US cents as at 8am in Wellington and earlier touched 73.75 cents, the highest since Feb. 22, from 73.30 cents late yesterday. The trade-weighted index rose to 75.48 - above the 75 average level the Reserve Bank has projected for the second quarter - from 75.04 yesterday.


Trump tweeted that he and Xi "will make great progress together" and he was very thankful for President Xi's "kind words on tariffs and automobile barriers." He was responding to Xi's keynote address to the Boao Forum yesterday that set a conciliatory tone despite offering no substantial new concessions. The trade spat has overshadowed economic indicators, which included a drop in optimism among small US businesses and a stronger-than-expected US March PPI. Commodity-linked currencies were among the biggest gainers overnight.


"Calming comments from the Chinese president, plus a generally risk-on mood, contributed to a decent rally in commodity currencies, with the NZD/USD hitting levels not seen since February," said Miles Workman, an economist at ANZ Bank New Zealand, in a note. "Risk on returned after President Xi eased trade war fears in his speech yesterday. A second wind followed after president Trump took to Twitter to thank Xi for his kind words."


With no local economic data scheduled for release today, traders may focus on April consumer confidence, Chinese PMI for March and a speech by Reserve Bank of Australia governor Philip Lowe later in the day.


The kiwi rose to 4.6263 yuan from 4.6130 yuan late yesterday. It edged up to 94.87 Australian cents from 94.76 cents and rose to 51.96 British pence from 51.68 pence. The kiwi traded at 59.61 euro cents from 59.50 cents and rose to 78.94 yen from 78.49 yen.



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
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:

MARKET CLOSE: NZ shares rise as optimism over US-China trade deal lingers; Fletcher gains
NZD under pressure against Aussie as investors cheered by easing of trade jitters
PFI properties’ valuation rises 5.5% to $1.32 billion
Broader definition of workplace harm in new govt health & safety strategy
MBIE officials grilled on terms of Westland Milk loan
Trade Me suitor Hellman & Friedman drops out
Hydrogen not a short-term option for Huntly - Genesis
Kiwibank says customers have a dwindling need of physical branches
Buying off the plans driving down KiwiBuild cost to govt: HYEFU
Fiscal policy to slow growth over next five years, despite surpluses

IRG See IRG research reports