Yahoo Finance New Zealand Dollar Plunges after Business Confidence Survey Signals Slower Growth
Asian stock markets are posting mixed results on Wednesday amid lingering concerns over deteriorating trade relations between the U.S. and China. Investors are also reacting to a strong surge in crude oil prices, which is helping to drive up energy sector stocks. However, higher energy costs are weighing on shippers and air transport stocks.
Japan’s Nikkei 225 fell 0.46 percent, with financials and utilities being the biggest drag on the index. In Korea, the Kospi gave up earlier gains to finish 0.17 percent lower, gains in blue chip technology stocks were offset by weakness in automaker and steelmaker shares.
Rising oil prices also helped boost energy shares in Hong Kong’s Hang Seng index and Australia’s S&P/ASX 200.
Crude Oil
U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are trading higher early Wednesday, underpinned by supply disruptions in Libya and Canada. On Tuesday, the U.S. State Department ignited a spike to the upside after saying all countries should stop Iranian crude imports in November.
In other news, the American Petroleum Institute (API) on Tuesday reported a 9.2 million barrel reduction in U.S. crude inventories in the week to June 22 to 421.4 million barrels.
Gold
Gold prices are trading lower early Wednesday with prices hovering around the December 12 bottom at $1251.90.
Gold continues to be shunned by the hedge funds, who are aggressively moving money into the U.S. Dollar on expectations of at least two more rate hikes in 2018 by the Fed, and as many as three more next year.
On Tuesday, Dallas Fed Bank President Robert Kaplan said he believes the U.S. central bank’s monetary policy is still accommodative and suggested the Fed could raise rates at least two more times before it stops being accommodative. However, Federal Open Market Committee member Raphael Bostic said he may rule out a fourth rate hike this year if trade issues start to negatively affect the economy.
Forex
The New Zealand Dollar is plunging early Wednesday, hitting its lowest level of 2018 after a report on business confidence signaled slower growth.
According to the ANZ Bank’s business confidence survey, a net 39 percent of companies were pessimistic about the 12 months ahead, down 12 points from the last reading. This was also the lowest reading since November.
Earlier in the session, the Kiwi held steady to higher after the New Zealand Trade Balance came in at 294 million, much higher than the 100 million estimate. The previous report was revised lower to 193 million.
This article was originally posted on FX Empire
