Connect with us

Global Banking and Finance Review is an online platform offering news, analysis, and opinion on the latest trends, developments, and innovations in the banking and finance industry worldwide. The platform covers a diverse range of topics, including banking, insurance, investment, wealth management, fintech, and regulatory issues. The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website. .

Trading

Kiwi dollar holds gains after surprise rate hike projection; dollar steady

2021 05 26T011705Z 1 LYNXNPEH4P01O RTROPTP 4 USA RATES SOFR - Global Banking | Finance

By Elizabeth Howcroft

LONDON (Reuters) -The New Zealand dollar was up more than 1% on Wednesday, holding on to gains after the central bank hinted at a possible interest rate hike by September 2022, while the U.S. dollar was steady near 5-month lows.

The Reserve Bank of New Zealand (RBNZ) surprised many market participants by projecting that it might hike interest rates as early as September next year.

The New Zealand dollar jumped to a three-month high on the news and held onto these gains during the Asian session. At 1049 GMT it was up 1.1% at 0.73075.

The Australian dollar – which is seen as a liquid proxy for risk appetite – was up 0.4% at 0.778.

So far, the Reserve Bank of Australia (RBA) has stressed that its policy will stay super loose for an extended period, with no hike seen until 2024 at the earliest.

“I think markets going forward will start to question the RBA’s commitment to its ‘no hikes before 2024’ and so there’ll be some positive spillover into the Aussie,” said Adam Cole, chief currency strategist at RBC Capital Markets, noting that markets were “very sensitive” to rates cycles.

“Canada we’re already there, essentially. The CAD outperformance this year has all been about the market pricing in the first steps to tighter policy in Canada so in the commodity block the Aussie is probably a laggard with scope to catch up.”

The dollar index was steady at 89.734, having fallen over the past two months as investors expect low U.S. rates to drive cash abroad to capture the gains from other countries recovering from the pandemic.

Federal Reserve officials reiterated that they would not change their ultra-supportive monetary policy stance any time soon – although San Francisco Federal Reserve Bank President Mary Daly told CNBC that they were “talking about talking about tapering”.

China’s onshore and offshore yuan strengthened to three-year highs versus the dollar. The onshore currency broke through 6.40 – a key psychological level – to trade at 6.39.

A day earlier, China’s major state-owned banks had bought dollars at that level in a move viewed as an attempt to cool the rally, sources said.

The Japanese yen was steady, changing hands at 108.88 per U.S. dollar.

The euro slipped slightly against the dollar, down 0.1% on the day at $1.22375 but still close to its highest since January.

Commerzbank strategist You-Na Park-Heger wrote in a note to clients that the euro was becoming more attractive, but she does not see scope for much further gains before the June 10 European Central Bank meeting.

In cryptocurrencies, bitcoin was up 3.3%, having earlier risen above $40,000. Ether was up 4% at around $2,800, close to where it started the month.

Iran has banned the energy-intensive mining of cryptocurrencies such as bitcoin for nearly 4 months, as the country faces major power blackouts in many cities.

(Reporting by Elizabeth Howcroft; Editing by Giles Elgood and Alex Richardson)

Global Banking & Finance Review

 

Why waste money on news and opinions when you can access them for free?

Take advantage of our newsletter subscription and stay informed on the go!


By submitting this form, you are consenting to receive marketing emails from: Global Banking & Finance Review │ Banking │ Finance │ Technology. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Recent Post