The Kiwi Dollar opens lower this morning as global risk sentiment continued to come under pressure amid concerns over the global economy, escalating tensions in Hong Kong, and political uncertainty in Argentina. A lack of economic data to start the week added to the risk-off sentiment with safe-haven currencies the Swiss Franc and Japanese Yen both well supported.
Credit Growth Slows in China
Concerns over the global economy were not helped yesterday with news that credit growth in China is slowing quite rapidly, and well below market expectations. Banks lent around US$150 billion in new loans in July, 30% lower than June, and 15% below market expectations. The weak data will likely place more downward pressure on the Yuan as Beijing looks to boost the economy with no end in sight to the US-China trade war.
Pound Halts Decline
The British Pound bounced back after recent weakness as UK media reported that anti-brexit MP’s were planning a no-confidence vote in PM Boris Johnson when parliament returns in September. The “remainers” are looking to prevent the government from going ahead with a no-deal Brexit. On the economic front, we have UK unemployment data tonight and CPI numbers tomorrow night.
Nothing of note on the local data front today with the NZD likely to take direction from global events, and there will be much interest in U.S inflation data released tonight.
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