Money: Australia, New Zealand dollars on defensive amid changing trade, rate outlooks - - PressFrom - Australia

MoneyAustralia, New Zealand dollars on defensive amid changing trade, rate outlooks

12:00  11 june  2019
12:00  11 june  2019 Source:

Australia shares eke out gains, banks weaken ahead of likely RBA rate cut

Australia shares eke out gains, banks weaken ahead of likely RBA rate cut Australia shares eke out gains, banks weaken ahead of likely RBA rate cut

Darius Shahtahmasebi is a New Zealand -based legal and political analyst who focuses on US foreign policy in the Middle East, Asia and Pacific region. And we don’t need a Foreign Affairs article to tell us that regime change is the ultimate goal of Washington’s war hawks with respect to Iran.

Right now, amid a trade war with Beijing, it is a word that officials Eight years ago, a trade dispute with Japan irritated Beijing enough to embargo rare earths exports to Japan. Meanwhile in Australia , the federal government recently selected 15 rare earths mining projects that it will support as part of a

Australia, New Zealand dollars on defensive amid changing trade, rate outlooks© AAP Image/Dave Hunt The Australian and New Zealand dollars were on the back foot on Tuesday as their U.S. counterpart continued to benefit from the trade truce with Mexico, even as Washington kept up the war of words with China.

The Aussie was pinned at $0.6956, having lost 0.6% on Monday in the wake of the trade truce with Mexico. It had reached as high as $0.7025 at one stage before retreating.

The kiwi eased to $0.6599, after shedding 0.8% on Monday in a pullback from a $0.6681 top.

President Donald Trump's decision not to impose tariffs on Mexico was taken as lessening the risk of recession in the United States and lifted 10-year Treasury yields up to 2.15% from a 2-month low of 2.05%.

Wall Street soars on US rate cut hopes

Wall Street soars on US rate cut hopes Wall Street has soared after Fed chair Jerome Powell indicated a rate cut may be in the offing; tech stocks surged 3.3% and all indexes closed up more than 2%.

Australia and New Zealand Banking Group Ltd. sees the cash rate dropping to 0.25% by May from its current 1%, while AMP’s Oliver is forecasting another half a percentage point of easing by December, particularly if the jobless rate remains elevated. Jobs Conundrum.

Working-level trade teams from the U.S. and China will meet next week and communicate on issues including trade balance, market access and investors protection, Xinhua reports, citing Vice Premier Liu He. Any further agricultural purchases are yet to be made and the volumes are still undecided

It also led investors to trim expectations for interest rates cuts from the Federal Reserve, though futures are still wagering heavily on a move in July.

Trump did not sound so conciliatory towards China, however, threatening another round of tariffs if no progress was made on trade at a Group of 20 summit later this month.

China is Australia's single largest export market and investors use the Aussie as a liquid proxy for positions on its economic outlook.

The Aussie has troubles of its own as a survey of Australian business showed activity faltered in May even as confidence got a rare boost.

The Reserve Bank of Australia (RBA) has already cut interest rates to a record low of 1.25% and markets imply around an 86% probability of a further reduction by August.

Rate cut may help construction industry

Rate cut may help construction industry IBISWorld says Tuesday's rate cut may help the construction industry in particular, with improved conditions for residential construction.

U.S. futures extend Wall Street rally as U.S. delays round of tariffs on Chinese goods. European shares reverse early gains ahead of ECB rate announcement. Gold, Treasurys also gain ground, revealing lingering cautiousness.

Bloomberg New Economy. Future Finance. Whirlwind Day in FX Leaves Dollar Weaker After Trade Report, Australia 's Biggest Economic Stimulus Since 2009 Isn't Worki Still, the signs of progress were enough to help buoy sentiment amid expectations of further central bank easing The ECB changed its guidance on interest rates to say they’ll stay at present or lower levels until the outlook

"Today's survey again suggests increased risk that the unemployment rate will not make the further gains the RBA expects and strongly argues the case for further near-term easing in monetary policy," said Ivan Colhoun, NAB's chief economist, markets.

"A weak outcome for unemployment would likely cement a July cut," he added, referring to the official jobs report for May which is due on Thursday.

Median forecasts are that employment rose a solid 17,500 in May, nudging the jobless rate down a tick to 5.1% - an outcome that would likely lessen the urgency for a rate cut as early as July.

Australian government bond futures were lower on Tuesday as risk appetite globally got a boost from the U.S.-Mexico trade news. The three-year bond contract fell 2.5 ticks to 98.920, while the 10-year contract slipped 3 ticks to 98.5100.

New Zealand government bonds were little changed.

Read more

Wall Street ends higher after the Fed's hold-steady decision.
Investors took the central bank's decision and revised outlook in stride, without reacting extremely one way or the other

—   Share news in the SOC. Networks

Topical videos:

usr: 0
This is interesting!