The Kiwi opens higher across all major currencies today.
German Chancellor Angela Merkel announces stepping down as CDU party leader
Germany’s Angela Merkel has confirmed she will give up her party chair in December after her party suffered heavy losses in the regional elections held over the weekend. Merkel has mentioned that she would like to remain Chancellor until 2021 when her term expires. The Euro initially dipped on the announcement with the Kiwi rising as high as 0.5756, but the NZDEUR has since pared back most of these gains.
US Plans More Tariffs on China If Trump-XI Meeting Fails
The US is preparing to announce tariffs on all remaining Chinese imports in December if talks fail between Presidents Donald Trump and Xi Jinping fail. The tariffs will apply to imports from China that aren’t already covered which could be approximately USD257 billion. Markets remain cautious on the potential global economic fallout.
Britain’s Finance Minister Philip Hammond’s Upgrades Growth Outlook
UK Chancellor Philip Hammond lowered projected deficits and upgraded the growth outlook for the economy in his last budget plan before Britain leaves the European Union in March. The comments failed to boost the GBP as markets remain nervous on a no-deal scenario.
Volatility Returns To Markets In October
Volatility (as measured by the VIX Index below) and often referred to as the ‘fear index’ as it tends to jump in times of uncertainty and worry and appears to have returned in October. This prompted the recent sell-off in stocks and commodity currencies as investors concerned on rising US interest rates and as global risk sentiment remains fragile.
Contact your dealer today if you would like further information or ideas for covering your foreign currency exposure as we approach 2019.
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