EncoreFX’s daily market updates are written by our experienced and professional dealing team.
The Kiwi Dollar trades lower this morning as concerns over global trade continue to weigh on market risk appetite. Risk based currencies such as the NZD and AUD both lost ground after trading higher at the back end of last week. There is little in the way of meaningful data to start the week and more relatively quiet trading is expected today. Later in the week we see Australian CPI tomorrow afternoon, the ECB rate decision on Thursday, and US Q2 GDP on Friday.
Global trade wars and related comments from international leaders (specifically President Trump) continue to be the most likely factors to influence currency markets this week. Trump is not happy that the US Dollar has strengthened over recent months as he believes this makes US exporters uncompetitive. He has also taken a swipe at his own Central Bank stating they should not raise interest rates any further. US Treasury Secretary Steven Mnuchin spent the weekend at the G-20 summit in Buenos Aires easing fears that a currency war is about to break out while reassuring finance chiefs that the President fully supports Federal Reserve independence. On the other side of the fence, a foreign-ministry spokesperson in Beijing said China has no desire to devalue the yuan amid trade stresses. No doubt there will be more of these comments and statements over the coming weeks.
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