The US dollar was placed on the defensive on Friday due to doubts whether the Federal Reserve will be willing to hike interest rates amidst worries over a new Covid variant of concern.
However, the Australian dollar benefitted from an unexpectedly solid uptick in the fourth quarter Australian gross domestic product.
As the economy delivered growth of 2.2% on the year in the final three months of 2019, in spite of global trade jitters, AUD exchange rates found a rallying point.
With investors betting on the prospect of further central bank monetary loosening to come the downside potential of the New Zealand dollar also diminished.
The appeal of the Australian dollar could easily fade, however, if January’s trade surplus narrows as expected.
Signs of weakening trade would cast a fresh shadow over the outlook of the Australian economy, especially if Chinese data also shows a slowdown.
In the absence of any fresh New Zealand data NZD exchange rates are likely to remain tied to any shifts in global market sentiment as speculation over Covid-19 continues.
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)