Dollar steady as debt ceiling worries weigh; Kiwi slips 1%

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SINGAPORE – The decline of the US dollar

Wednesday, but remained close to the highest level in two months as negotiations

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Due to the raising of the US debt ceiling, the New Zealand dollar continued

It fell 1% after the New Zealand central bank surprised the markets with it

Put an end to price hikes.

The Reserve Bank of New Zealand raised interest rates by 25%

basis points, as expected, to the highest level in more than 14 years

at 5.5% and its policy statement predicts that rate will be

prevailing until June 2024 – unchanged from the previous forecast.

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The Reserve Bank of New Zealand has been surprisingly peaceful in its letters and

Outlook,” said Carol Kong, Commonwealth Currency Strategist

Bank of Australia (CBA). Unlike the market

Forecasts, the Reserve Bank of New Zealand maintained its expected cash rate peak at

5.50% and indicated the end of the tightening cycle. “

The New Zealand dollar fell 1.3% to close to three

A week low at $0.6165 after the decision. Australian dollar

It fell 0.24% to $0.659.

Meanwhile, the impasse in Washington on the debt ceiling

Negotiations helped raise the dollar, though it could

It leads to default and pushes the country into recession

Investors think that could cause worse problems for the world

Economy.

Dollar index, which measures the US currency

Against six major competitors, it was at 103.43 in Asian hours, not far behind

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From a two-month high at 103.65, it touched it overnight.

Treasury Secretary Janet Yellen warned that the Fed

The government can no longer have enough money to pay everything it has

Invoices as early as June 1, which increases the risk of adverse default.

Investors have largely avoided higher risk investments on the part of other investors

Round of talks between the White House and the Republicans

The borrowing limit hike ended Tuesday with no sign of it

progress.

“Although the probability of a technical default is very low,

It appears to be substantially higher than it was in the previous debt ceiling

Confrontations due to the current political landscape,” said Jake

Julie, Head of Investment Analysis at BNY Mellon Investment

administration.

Moreover, it is unclear what form the debt deal will take

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influence on financial projections.

Elsewhere, the yen rose 0.11%, to 138.42

against the dollar, after touching a six-month low of 138.91 overnight,

While the euro rose 0.09% to $1.0778.

The pound was last trading at $1.2431, up 0.17%.

Today, after touching a one-month low of $1.2373 on Tuesday.

Investors will be watching inflation data from the UK which will do so

View if prices have gone down.

The hawkish rhetoric from Federal Reserve officials has had the same effect

The dollar rose, with traders expecting interest rates to

Stay high for longer.

Markets are pricing in a 27% opportunity with an increase of 25 basis points

In June, the CME FedWatch tool showed, following a quarter point from the Fed

increased earlier this month.

Investors will get more clues to the policy than the minutes

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Fed meeting in May, scheduled for later in the day.

“We suspect the core issue between leadership

The commission is that the stress cycle may have ended.”

Kevin Cummins, Chief Economist, NatWest Markets.

The recent rhetoric by a few officials seems to interest him

Additional height(s), perhaps this feeling as well

It is reflected in the tone of the minutes.

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The currency bid prices are at 0445 GMT

Description RIC Last US Close Pct Change YTD Pct High Bid Low Bid

previous change

a class

EUR/USD 1.0781 USD 1.0771 +0.09% +0.61% +1.0781 +1.0768

USD/JPY 138.3750 138.5900 -0.10% +5.49% +138.6300 +138.3800

euro / yen

USD/CHF 0.9009 0.9016 -0.08% -2.57% +0.9015 +0.9009

GBP/USD 1.2434 1.2416 +0.15% +2.82% +1.2435 +1.2416

USD/CAD 1.3500 1.3503 +0.00% -0.34% +1.3510 +1.3497

AUD/USD 0.6599 0.6611 -0.18% -3.19% +0.6615 +0.6586

NZ 0.6167 0.6248 -1.30% -2.87% +0.6256 +0.6166

dollars / dollars

All spots

locations in Tokyo

Spots in Europe

twists

Tokyo forex market information from the Bank of Japan

(Submitted by Ankur Banerjee and Tom Westbrook in Singapore

Editing by Shri Navaratnam and Simon Cameron Moore)