Wednesday 24th January 2018
|Text too small?|
The New Zealand dollar rose to a four-month high as US President Donald Trump raised tariffs on imports of washing machines and solar panels, raising fears about the White House's protectionist attitude.
The kiwi dollar climbed as high as 73.64 US cents and traded at 73.43 cents at 8am in Wellington from 73.22 cents yesterday. The trade-weighted index gained to 75.39 from 75.21 yesterday.
The Dollar Index, a measure of the greenback against a basket of currencies, fell 0.2 percent after US Trade Representative Robert Lighthizer announced plans to impose a new 30 percent tariff on imported solar panels and tariffs of up to 50 percent on residential washing machines. The announcement comes as the US, Mexico and Canada prepare for the latest round of renegotiations on the North American Free Trade Agreement. Trump has advocated tilting trade relationships in favour of the US, raising fears a growing tide of protectionist policies could weigh on global trade.
"While Trump had pledged to get tough with America’s trade competitors during the election campaign, the move yesterday was the first time he had directly signed off on increased tariffs in his time in office," Bank of New Zealand interest rate strategist Nick Smythe said in a note. "The USD is generally weaker again, with Trump’s imposition of tariffs seemingly the latest excuse to sell the dollar."
Still, equity markets were largely unfazed by the tariff announcement with stocks on Wall Street gaining on the strength of corporate earnings, while commodity prices gained with Brent crude oil up 1.3 percent to US$69.90 a barrel.
Local data today include credit card spending and balances for December.
The kiwi was little changed at 81.04 yen from 81.10 yen yesterday after Japan's currency rallied on a shift in the Bank of Japan's language on inflation expectations, which it viewed as stable rather than falling.
The local currency rose to 91.90 Australian cents from 91.66 cents yesterday and gained to 4.6995 Chinese yuan from 4.6842 yuan. It increased to 52.51 British pence from 52.36 pence yesterday and traded at 59.79 euro cents from 59.73 cents.
No comments yet
Perky services sector in Janary soothes fears over cooling economy
PFI doubles 2018 profit on valuation gains, underlying earnings fall short
Steel & Tube turnaround continues with 49% jump in first-half net profit
February 18th Morning Report
FIRST CUT: Port of Tauranga lifts 1H profit 4%
NZ dollar starts the week with a tailwind as positive US-China trade talks boost sentiment
Tax Working Group's capital gains proposal keenly awaited
MARKET CLOSE: NZ shares dip as global trade jitters weigh on A2, F&P
NZ dollar set for weekly gain after Reserve Bank surprise
Burger Fuel exploring sale after review questions listing merits