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Trade back to the fore

Published January 23, 2019

by Nicholas Cork

AUD has begun to maintain a new range below 0.7150, not added by another round of risk-off as Trump asked China via twitter to “stop playing around” and “do a real deal”.  Sentiment took a hit after this, and equities were then dumped as the FT reported that the Trump administration has rejected an offer from China to hold preparatory trade talks this week.  The attendees were going to be Chinese Vice-Commerce Minister Wang Shouwen and Vice-Finance Minister Liao Min, so no doubt this will be seen as a slap in the face and we now await the Chinese response ahead of the scheduled Jan 30 talks with Chinese Vice-Premier Liu He. Oil lost 2% on the fading sentiment, and not forgetting the IMF came late for a global downgrade yesterday morning.

Locally no data due today, New Zealand CPI was just released at 0.1% better than expected, and has seen the kiwi jump 30 pips on the news. AUD to likely remain 0.7100/0.7150 today but technically is starting to look oversold again.

Good Luck