Kiwi dollar set for weekly fall amid trade war
The New Zealand dollar is heading for a 0.4 per cent weekly decline having lurched more than US1c during the week in response to the US announcement that it plans to impose tariffs on a further US$200 billion of Chinese imports.
The kiwi traded at US67.75c at 5pm yesterday from US67.60c late on Thursday and down from US68c a week ago. The tradeweighted index edged up to 72.56 from 72.45 on Thursday, still down from 72.76 this time last week.
The US pronouncements saw a sell-off in commodities and commodity-linked currencies as traders fretted about the impact of a trade war. But the CRB commodity index, a measure of 19 commonly traded commodities, gained 0.6 per cent after China’s Ministry of Commerce said it was trying to avoid escalating the trade dispute.
The greenback fell overnight on Thursday following weaker-than-expected US inflation of just 0.1 per cent in June for an annual rate of 2.9 per cent, the highest year-on-year rate since early 2012. New Zealand is set to release second-quarter inflation figures, with a quarterly rate of 0.5 per cent forecast by ASB Bank for an annual rate of 1.6 per cent.
The kiwi didn’t move much after the Business NZ-BNZ performance of manufacturing index dropped 1.6 points to 52.8, seasonally adjusted in June.
The kiwi dollar gained to 76.31 yen from
75.78 yen on Thursday and fell to A91.31c from A91.53c. It increased to 51.40 British pence from 51.14 pence and gained to 58.09 euro cents from 57.82 cents. It was little changed at 4.5180 yuan. New Zealand’s twoyear swap rate fell 2 basis points to 2.14 per cent and 10-year swaps were unchanged at
3.02 per cent.