NEWS
Aussie, kiwi dollars struggle on China’s rate cuts; dollar adrift
Published On :
By Rae Wee
SINGAPORE (Reuters) – The Australian and New Zealand dollars languished near multi-week lows on Tuesday after China’s move to cut several key interest rates, while the dollar was little changed as it awaited fresh impetus.
China on Monday surprised markets by cutting major short and long-term interest rates in its first such broad move since last August, signalling intent to boost growth in the world’s second-largest economy.
The two Antipodean currencies, often used as liquid proxies for the Chinese yuan, were flat after slumping in the previous session in the wake of the news. The Australian dollar was trading at $0.6643 early on Tuesday and the New Zealand dollar dipped 0.01% to $0.5979.
“For the Aussie and the kiwi, they tend to be reflecting a more liquid and free expression in terms of the realities currently facing the Chinese economy,” said Rodrigo Catril, senior FX strategist at National Australia Bank (NAB).
“The easing coming from the PBOC yesterday is not huge in terms of magnitude, but it does signal that willingness for the PBOC to support the economy alongside the fiscal side, and that probably plays to the view that there will be some tolerance for a little bit of weakness in CNY.”
The offshore yuan last stood at 7.2973 per dollar.
In the broader market, currency moves were subdued as traders looked to central bank meetings in the U.S. and Japan next week.
The euro eased 0.02% to $1.0889, while sterling similarly fell 0.02% to $1.2928.
Against the yen, the dollar edged 0.14% lower to 156.79. The dollar index was flat at 104.29.
The market reaction to U.S. President Joe Biden’s decision to bow out of the election race over the weekend was muted, though there was some unwinding of the so-called Trump trade, which has seen the dollar and U.S. Treasury yields ease a touch, while bitcoin’s rally hit a pause.
“I think certainly the U.S. politics, as we get closer to the November election, will become a greater source of volatility for markets,” said NAB’s Catril.
“There’s still a lot of water to go through in terms of what the candidates have to offer and also how the polling may change as well. And then of course, getting a bit more clarity in terms of what the key policies will be and priorities will be, will be very important for markets.”
In cryptocurrencies, bitcoin fell 0.7% to $67,665, retreating from an over one-month top hit in the previous session.
(Reporting by Rae Wee; Editing by Stephen Coates)
Uma Rajagopal has been managing the posting of content for multiple platforms since 2021, including Global Banking & Finance Review, Asset Digest, Biz Dispatch, Blockchain Tribune, Business Express, Brands Journal, Companies Digest, Economy Standard, Entrepreneur Tribune, Finance Digest, Fintech Herald, Global Islamic Finance Magazine, International Releases, Online World News, Luxury Adviser, Palmbay Herald, Startup Observer, Technology Dispatch, Trading Herald, and Wealth Tribune. Her role ensures that content is published accurately and efficiently across these diverse publications.
-
-
NEWS4 days ago
Novartis to pay Monte Rosa $150 million upfront to develop a new class of drugs
-
-
-
TECHNOLOGY4 days ago
Volkswagen’s Traton reports higher sales in weak truck market
-
-
-
BUSINESS4 days ago
Covestro trims 2024 profit target again in a tough economy
-
-
-
BUSINESS4 days ago
Ericsson signs 5G ORAN deal with Spain’s MasOrange
-