Sharechat Logo

NZ dollar largely unchanged as investors take Syria missile strikes in their stride

Monday 16th April 2018

Text too small?

The New Zealand dollar was largely unchanged against the greenback with investors fairly sanguine about the US-led strikes on Syria over the weekend after a muted reaction from Russia. 

 

The kiwi dollar traded at 73.54 US cents as at 5pm in Wellington versus 73.53 cents at 8am and from 73.57 cents late Friday. The trade-weighted index was at 75.41 from 75.40.

 

The US, France and Britain launched 105 missiles targeting what the Pentagon said were three chemical weapons facilities in Syria in retaliation for a suspected poison gas attack. There were concerns about how Russia might react and while Russian President Vladimir Putin warned on Sunday that further Western attacks would bring chaos to world affairs, the reaction was viewed as muted. Putin's reaction seemed more like “posturing,” said Fat Prophets in a note. The spot gold price, which usually gains when investors seek safe-haven assets, edged up 0.1 percent to US$1,345.70 an ounce. 

 

"I would have thought we might have seen a bit more risk off on the open today, but it hasn't been the case. We've been contained in very tight ranges," said Mark Johnson, a senior dealer at OMF. He noted that US equity futures are currently positive, which is also helping risk appetite. Investors are gearing up for US corporate earnings with analysts expecting quarterly profit for S&P 500 companies to rise 18.5 percent from a year ago, the biggest gain in seven years, according to Reuters.

 

Domestically the market will be watching for this week's inflation data with economists expecting annual inflation of 1.1 percent and the tepid data will add to the view the central bank will keep rates on hold for the foreseeable future. "I can't see any reason for any hawkish overtones from the central bank," said Johnson.

 

He said, however, the main driver of the kiwi will remain offshore. "Geopolitics are dominating for the moment, it's the US every which way, whether its the US and China, the US and Russia and the US and Syria," he said 

 

The kiwi dollar decreased to 94.61 Australian cents from 94.72 cents in New York on Friday and traded at 78.86 yen from 78.97 yen. It slipped to 59.63 euro cents from 59.69 cents and traded at 51.58 British pence from 51.67 pence. It increased to 4.6207 yuan from 4.6166 yuan on Friday.

 

New Zealand's two-year swap rate lifted 1 basis point to 2.31 percent and the 10-year swap rate rose 3 basis points to 3.18 percent.

 

(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:

SML - Synlait Milk Limited - Trading Halt of Securities
AIA - Auckland Airport announces board chair changes
AIA - Auckland Airport announces board chair changes
CEN - Tauhara commissioning progress update
FPH initiates voluntary limited recall
March 28th Morning Report
KFL Celebrates 20 Years of Excellence in Investment Mgmt.
SVR - Savor FY24 Earnings Guidance & Change in Banking Partner
NZK - NZ King Salmon Investments Limited FY24 Results
March 27th Morning Report