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The Australian and New Zealand Dollars are putting in mixed performances on Friday with the strength of the U.S. Dollar respectively capping and pressuring the currencies. Both the Aussie and the Kiwi are weaker due to the positive sentiment in the greenback.
The U.S. Dollar is attracting buyers because of the unexpectedly more hawkish outlook from the Federal Reserve in this month’s monetary policy statement and subsequent speeches from Federal Open Market Committee members. Furthermore, the U.S. economy is still relatively stronger than had been anticipated.
At 10:36 GMT, the AUD/USD is trading .6751, up 0.0003 or +0.04% and the NZD/USD is at .6283, down 0.0011 or -0.17%.
The greenback is also being seen as a safe-haven asset against the uncertainty of U.S.-China trade relations and the political noise in the U.S. due to the impeachment inquiry on President Donald Trump.
Short-Term Influences
The Aussie is garnering some support ahead of the October 1 meeting of the Reserve Bank of Australia although analysts are predicting that the RBA is likely to lower its benchmark lending rate by 25 basis points to 0.75%.
On Thursday, the Reserve Bank of New Zealand chief said that the outlook for the New Zealand economy in a low rate environment should be viewed as an opportunity for investment. That suggested to investors that the RBNZ is likely to keep its official cash rate at low levels for an extended period.
U.S.-China Meeting Scheduled
CNBC reported trade talks between the U.S. and China were set to resume October 10-11 in Washington, D.C., according to three people close to the talks. Chinese Vice Premier Liu He will be representing the delegation from Beijing, one of the people told CNBC.
The White House, the Treasury Department and the Office of the U.S. Trade Representative did not respond to CNBC’s requests for comment before publication. This isn’t a big deal. Perhaps they had nothing to say since the Trump administration said weeks ago they expected the talks with Beijing, which stalled out in May, to resume next month.
Daily Forecast
On Friday, investors will get the opportunity to react to a slew of U.S. economic reports including Core Durable Goods Orders which is expected to come in at 0.2% and Durable Goods Orders which are expected to have declined by 1.1%.
Personal Spending is expected to have risen 0.3%, Core PCE Price Index is forecast to come in at 0.2% and Personal Income is forecast to have risen 0.4%.
A revised University of Michigan Consumer Sentiment report is called unchanged at 92.0.