The Dollar Looms Impeachment Vote, Kiwi Hovers On GDP Prospects
On Thursday, the New Zealand dollar rebounded from a one-week low in the foreign exchange market. The bounce-back was after the country’s third-quarter economic growth came in tougher than expected.
Meanwhile, greenback traders anticipated a vote to impeach U.S. President Donald Trump.
In Britain, the pound persisted under pressure on renewed concerns of a chaotic exit from the European Union. It was previously at $1.3077 after slipping almost 2% in as many days.
The kiwi increased to $0.6589 from Wednesday’s low of $0.6555.
The boost was after New Zealand’s annual gross domestic product speeds up 2.7% in the third quarter in contrast to expectations for a 2.4% improvement.
In December, some risk-sensitive currencies such as the kiwi and its Australian counterpart began on a firm foundation led by the evident removal of two main risks dominating global markets.
It is an initial U.S.-China trade agreement and the election triumph of the U.K. Prime Minister.
However, worries have reappeared this week. The possibility of U.S.-led tariff war has not vanished as trader’s lookout for clarity on the deal.
The matter was despite the Sino-U.S. trade agreement.
Meanwhile, the safe-haven yen remained in a robust range at 109.57 per dollar in the FX Markets.
So far this month, the safe-haven yen are mostly flat.
The United States Might Elevate Tariffs On European Supplies
Last Tuesday, U.S. Trade Representative Robert Lighthizer indicated that the United States might lift tariffs on European goods.
The lift is for the reason that they try to diminish the chronic trade shortage with the continent.
In addition, they will also be re-igniting concerns of the outlooks of the export-driven euro.
The euro was lastly floating around Wednesday’s low of $1.1109 versus the dollar in the forex trading. It has been shrugging off a better-than-expected assessment of German business optimism.
A Sydney-based head of forex strategy at National Australia Bank Ray Attrill said, “The most significant news overnight has been the German December IFO survey, which… has shown that the German economy might be in the process of pulling itself up by its bootstraps.”
He also said, “Improvement in the German and broader Eurozone economy is fundamental to our expectation for a softer U.S. dollar and stronger Euro next year.”
A significant headwind for the dollar will be because of a vote in the U.S. House of Representatives on whether to impeach Trump later in the day.
Meanwhile, the Senate is projected to vote in January.
An index that tracks the dollar alongside six major currencies leaped to a six-day high of 97.475. The increase was despite political uncertainty.