Collinson FX: August 21, 2018 - NZD lifts on Aussie woes

by Collinson FX 21 Aug 2018 05:36 PDT 17 August 2018

Ichi Ban - Matt Allen - Hamilton Island Race Week - Day 1 © Richard Gladwell

Collinson FX: August 21, 2018 - NZD lifts on Aussie woes

Equity markets surged towards record highs, with the prospect of closure to global trade wars, as a China/USA summit in November looms.

Trump has ‘verballed’ the Fed, imposing his expectations upon Powell, to keep rates low. Trump wants to keep interest rates as low as possible, to allow capital investment to flourish, adding fuel to the boom market. This is ahead of Central Bankers meeting at Jackson Hole. The environment at this meeting will be improving, with global moves tending towards rising rates and growth, rather than expansive monetary policy.

The Dollar eased slightly, with the EUR trading 1.1460, while the GBP pushed towards 1.2800. The Australian market was consumed with political intrigue, once again, with pressures mounting on PM Turnbull. Once again climate change may claim another Prime Ministerial scalp. His NEG energy policy has incensed the conservatives in his party, forcing a retreat, while crippling polls may be enough to topple the Liberal leader? The AUD held steady at 0.7320, supported by the softer reserve, while the NZD pushed up to 0.6625.

The Liberal/National coalition parties meet today and fireworks are expected. A change to Peter Dutton may even be greeted positively by markets!?

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