EncoreFX’s daily market updates are written by our experienced and professional dealing team.
The Kiwi has surged higher overnight on positive NZ retail sales, and as market optimism returns on a trade deal nearing.
Trade Deal “Very, Very Close”
President Donald Trump said he would delay the 1st March deadline for the planned hike in tariffs on Chinese imports as he was “very, very close” on a trade deal. Trump said he was optimistic that a final deal could be reached with China and will hold a summit to sign any pact. Equity markets reacted positively to the comments and the NZD opens 0.6% higher against the USD, with the biggest gains made against the safe-haven Yen, which opens this morning in the mid 76.50.
NZ Retail Sales Robust in Q4
In more good news for the Kiwi, NZ retail sales rose a staggeringly 1.7% in the fourth quarter, a strong pick up from the 0.3% growth seen in the previous quarter and came in much higher than forecasts. The NZD rose 0.4% to 0.6865 against the USD and bodes well for Q4 GDP which will be released later in March.
EU Pressure Mounts to Delay Brexit and Avoid No-Deal
With the March 29 deadline looming UK Prime Minister Theresa May is struggling to get the changes needed from the EU to get her divorce deal through a divided government. PM May postponed the vote on exiting the EU to March 12th and has said she wanted Brexit to happen as planned on March 29, shrugging off expectations she will be forced to delay Brexit to avoid leaving the EU with no deal. European Council President Donald Tusk described any delay as “a rational decision” and EU leaders are suggesting a delayed exit should target 2021.
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