China inflation data, Trump as well as RBNZ in focus

The Reserve Bank of completely new Zealand kept rates unchanged at 1.75 percent on Thursday as was expected, although its accompanying comments were seen as hawkish by markets. The Kiwi dollar held onto most gains made after the announcement to trade at $0.6961 at 3:13 p.m. HK/SIN. The currency had spiked as high as $0.6973 inside the Wednesday session, compared to levels around the $0.692 handle seen before the announcement.

President Donald Trump’s tour of Asia also remained inside the spotlight. Trump addressed the U.S.-China trade deficit during a Thursday speech in Beijing as well as said he might work on fixing “unfair trade practices.”

Meanwhile, China October consumer prices rose 1.9 percent compared to one year ago, a touch above the 1.8 percent rise forecast in a Reuters poll. Producer prices also topped expectations, increasing 6.9 percent on year compared to the 6.6 percent forecast.

Stateside, off-year elections saw Democrats score victories in Virginia as well as completely new Jersey in Tuesday polls. While “there was some chatter about yesterday’s U.S. governor elections … as well as what they could mean or signal about the viability of some of the U.S. administration’s reforms,” in which had little impact on the markets, Martin Whetton, a strategist at ANZ, said in a note.

On the matter of tax reform, U.S. House of Representatives Speaker Paul Ryan indicated there might still be growth even having a phased implementation of corporate tax cuts, Reuters said. in which followed a Washington Post report on Tuesday in which said a one-year delay inside the implementation of tax reform measures was being considered.

The dollar eased on Thursday after slipping inside the last session. Against the Japanese yen, the greenback traded at 113.59 at 3:12 p.m. HK/SIN after climbing as high as 114.06 earlier inside the day. The dollar index, which tracks the U.S. currency against a basket of six currencies, stood at 94.731.

Commenting on moves inside the foreign exchange markets in response to U.S. political developments, Stephen Innes, APAC head of trading at OANDA, said markets were struggling to find a reliable argument to stick to.

“[M]uddling through the political bluster can be more of a distraction than a guide,” he said in a morning note.

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