30 August 2018 : In Australia and New Zealand, the situation is looking gloomier. AUDUSD fell 0.4% on Wednesday after Westpac, one of the largest nation’s banks raised mortgage rates by 14 basis points as funding costs increased. This move may lead to further delaying an interest rate hike by the Reserve Bank of Australia as more banks are likely to follow Westpac’s actions leading to lower disposable incomes for consumers already struggling with low wage growth. The currency lost another 0.4% today after capital expenditures unexpectedly fell 2.5% in Q2 which will become increasingly worrying if such a trend continues.
The New Zealand dollar is the worst major performing currency today. NZDUSD fell almost 1% in the Asian trading session after business confidence fell to -50.3% in August, a level not seen since April 2008. These figures are likely to be reflected in lower GDP growth for Q3 and lowering interest rates may be taken into consideration. Thus, expect to see further declines in the currency until economic data starts pointing north again.
Source: Hussein Sayed, Chief Market Strategist at FXTM
Reporting for EasyKobo on Thursday ,30 August 2018 in Lagos, Nigeria