Kiwi loses out to North Korea crisis
The New Zealand dollar barely budged from where it started the day after a lift from strong retail sales data proved short-lived as attention focused on North Korea.
The kiwi rose as high as US73.31c after the retail sales data and was trading at US73.07c at 5pm in Wellington from US73.09c at 8am. The trade-weighted index rose to 76.93 from 76.82 last week.
Government figures yesterday showed the volume of retail sales rose 2 per cent in the June quarter, underpinned by increased spending during the World Masters Games and the Lions rugby tour.
“It jumped on retail sales numbers but when you looked at the detail, it was the Lions tour,” said Tim Kelleher, head of institutional foreign exchange sales at ASB Bank. “Otherwise, it has been a
The US has no interest in regime change or accelerated reunification of Korea.
reasonably quiet day in Asia.”
Looking ahead, Kelleher said the market was watching for further developments over tensions on the Korean peninsula, although some risk appetite had returned with the Dow futures pointing to a positive day.
The greenback benefited, bouncing slightly against the yen despite Japan’s gross domestic product data being stronger than expected. The greenback was at around ¥109.07 per US dollar before the data and was recently at ¥109.50.
US Secretary of Defence Jim Mattis and Secretary of State Rex Tillerson wrote in the Wall Street Journal that the Trump Administration was continuing to seek diplomatic solutions to seek the “irreversible denuclearisation” of North Korea.
“The US has no interest in regime change or accelerated reunification of Korea,” the two wrote in a commentary.
The US also had no desire to station troops north of the Demilitarised Zone, they added.
“We are waiting for headlines,” said Kelleher.
Closer to home, Kelleher said investors would be watching for results from the GlobalDairyTrade Auction tonight. Nigel Brunel, director of financial markets at OMF, said whole milk powder and skim milk powder were holding premiums over the last auction, “suggesting a small rise in the index led by whole milk powder”.
The kiwi slipped to 4.8682 yuan from 4.8747 yuan on Friday in the US, declined to €61.8c from €61.91c and decreased to 56.15 British pence from 56.24p. The kiwi was at A92.53c from A92.67c.
Both the kiwi and the Australian dollar may have been weighed down by data showing China’s industrial production and retail sales slowed in July.
The two-year swap rate was unchanged at 2.14 per cent while 10-year swaps rose 1 basis point to 3.12 per cent.
US Secretary of Defence Jim Mattis and Secretary of State Rex Tillerson