The FOMC Kept The Rates Unchanged - APAC Update

Xe Corporate APAC

March 20, 2019 3 min read

The NZDUSD opened at 0.6909 (mid-rate), and the AUDUSD opened at 0.7141 (mid-rate) this morning.

This morning’s NZ Q4 GDP report is expected forecast to have increased by 0.6% following on from Q3’s disappointing 0.3% print.

US Update

The USD is firmly on the back foot following this morning’s “dovish FOMC statement.”

The Federal Reserve kept rates unchanged at this morning’s meeting, but downwardly revised both their interest rate and economic growth forecasts. The Fed’s dot plot which forecasts where they see where they predict interest rates will go over the next 3-years. The original prediction was for two interest rates hikes for 2019, and now has no raises on the horizon until 2020.

The Fed also revised lower its GDP and PCE inflation forecasts for 2019, with GDP growth now expected to run at 2.1%  (down from 2.3% last December) and PCE inflation now expected to run at 1.8% (down from 1.9% last December).

Brexit Update

Brexit uncertainty continues to weigh on the GBP. Overnight, European Council President Donald Tusk said the EU will only agree to delay Brexit till the 30th June if the UK's Parliament approves British Prime Minister Theresa May's current exit plan. Mr Tusk’s comments came after Mrs May announced to parliament that her government was not prepared to delay Brexit any further than the 30th of June and wrote to Mr Tusk asking for the 3-month delay.

Since the Speaker of the House ruled ministers can't vote for a third time on the same Brexit divorce agreement, it is perplexing to think what PM May will do next.

Global equity markets are mixed, - Dow -0.15, S&P 500 +0.15, FTSE -0.45%, DAX -1.57%, CAC -0.80%, Nikkei +0.20%, Shanghai -0.01%. Gold prices are edging lower, down 0.4% trading at $1,301 an ounce.

WTI Crude Oil prices are once again higher overnight, up 0.8% trading at $59.68 a barrel.

Mid-market Rates

AUDUSD0.71410.7%NZDUSD0.69090.8%AUDEUR0.6242-0.1%NZDEUR0.60410.0%AUDGBP0.53930.9%NZDGBP0.52191.0%AUDJPY79.110.2%NZDJPY76.550.2%AUDNZD1.0335-0.1%NZDAUD0.96750.1%GBPAUD1.8543-0.9%NZDCAD0.91650.4% GBPNZD1.9161-1.0%
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