The euro slumped on Thursday following the European Central Bank’s (ECB) latest interest rate decision.
Trade war fears saw the Australian Dollar and New Zealand Dollar start the week on soft form, although there were also opportunities for the high-risk currencies to rise.
The outlooks for the Australian and New Zealand economies took a knock after America moved forwards with plans to implement tariffs on steel and aluminium imports; this was particularly concerning for Australia, given that the nation accounts for around half of the globe’s exports of iron ore, a key steelmaking ingredient.
The Australian dollar also struggled with another interest rate freeze from the Reserve Bank of Australia (RBA) and a set of worse-than-expected GDP figures for the fourth-quarter.
Both AUD and NZD received a boost after it was announced that North Korea and South Korea would hold a summit in April in an attempt to improve relations between the two nations that have been divided ever since the Korean War ended in 1953 with no formal peace agreement.
North Korea even suggested it would denuclearise if the United States agreed to talks and it felt it was free from military threat, so markets were feeling much more confident that geopolitical tensions were waning.
Tomorrow sees an unusually busy Australian data calendar, with loans data, the NAB business conditions and confidence survey results and Westpac consumer confidence indices due during the day, as well as speeches from RBA officials Bullock and Kent.
The biggest development on the New Zealand data calendar this week will be Wednesday’s fourth-quarter GDP figures, which are expected to show a solid acceleration in growth to 0.8% on the quarter and 3.1% on the year.
Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure
Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)