AUD & NZD Move Downwards Before Trump's Tariff Deadline Kicks in - APAC Update

Xe Corporate APAC

May 9, 2019 3 min read

The AUD opened at 0.6991, and the NZD opened at 0.6592 this morning.

In what is the calm before the storm, the market collectively holds its breath before Trumps tariff deadline kicks in at 4pm NZT today. Talks actually recommence at 9:00 am NZT, so it is going to be a pretty choppy day, with headlines going both ways before a deal is agreed or not. This wouldn’t be the first “Deadline” in history to get extended, but given Trumps escalation, and with such little time to get anything real agreed to, it looks like he is putting the ball in China’s court, so he can offload the blame for a deal not happening.

Given the above, it is no surprise to find both the NZD and the AUD testing the recent lows. The AUD especially, if you exclude the flash crash, we are down at levels not seen in over 3 years. This really highlights just how ugly things could get, given where we are starting, on a trade war escalation.

To get back to news a little closer to home, we have the RBA Monetary Policy Statement out at 1:30 PM NZT. Generally not something you would want to skip your coffee for, this one should be slightly more interesting given they could conceivably have cut on Tuesday, and the next meeting, after the Australian elections, is going to be a live one.

US CPI overnight rounds us out, but really this is going to be a day where all eyes will be on the trade negotiations.

Global equity markets are on the back foot, - Dow -0.54%, S&P 500 -0.51%, FTSE -0.87%, DAX -1.69%, CAC -1.93%, Nikkei -0.93%, Shanghai -1.48%.

Gold prices are little changed, trading at $1,285 an ounce. WTI Crude Oil prices are off a touch, down -0.9%, trading at $61.53 a barrel.

Mid-market Rates

AUDUSD0.69910.0%NZDUSD0.65920.3%AUDEUR0.6229-0.2%NZDEUR0.58720.0%AUDGBP0.5369-0.1%NZDGBP0.50630.2%AUDJPY76.65-0.4%NZDJPY72.26-0.2%AUDNZD1.0605-0.2%NZDAUD0.94270.2%GBPAUD1.86220.1%NZDCAD0.88780.2% GBPNZD1.97510.2%
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