Monday, 19 November 2018, 8:26 pm
NZ dollar still firm against USD but gains capped by waning risk appetite
By Rebecca Howard
Nov. 19 (BusinessDesk) – The New Zealand dollar held its gains against the greenback after the US Federal Reserve officials were cautious about the global growth outlook but jitters about the US-China trade dispute kept it capped.
The kiwi traded at 68.52 US cents at 5pm in Wellington versus 68.53 US cents at 8am and from 68.76 cents on Friday in New York. The trade-weighted index was at 74.67 from 74.83 last week.
Richard Clarida, the Fed’s newly appointed vice chair, cautioned about a slowdown in global growth in an interview with CNBC while Federal Reserve Bank of Dallas President Robert Kaplan told Fox Business he is seeing a growth slowdown in Europe and China. Those comments weighed on the US dollar as investors saw them as signaling fewer rate cuts on the horizon.
The kiwi, however, is keeping to a very tight range as ongoing worries about the US-China trade dispute weigh on risk appetite, said Mark Johnson, a private client manager at OMF.
Weekend comments by US Vice President Mike Pence fueled the concerns. Pence – who was attending the Asia- Pacific Economic Cooperation summit in Papua New Guinea – said that there would be no end to U.S. tariffs on $250 billion of Chinese goods until China changed its ways, according to Reuters. Also, for the first time in its nearly three-decade history, officials of the 21-member Pacific Rim group ended two days of meetings in Port Moresby without issuing a joint communique.
“You all know who the two big giants in the room were, so what can I say, ” PNG Prime Minister Peter O’Neill said, Dow Jones Newswires reported.